US copper futures ended modestly lower on Monday, after trimming most losses sustained as the dollar strengthened, traders said. As the dollar gave back some of its gains, and copper supplies in London appeared to tighten, New York copper buyers grabbed the red metal at session lows, they added. "Everybody is still selling copper on the weaker euro. They're looking at one tiny factor in the (copper) market and ignoring 20 things that are bullish. So, they tried to knock it down against the weaker euro, but there's so many bullish factors, like today's data," said one copper trader.
At the Comex division of the New York Mercantile Exchange, benchmark March copper was down 0.35 cent at $1.4350 per lb., in a range running from $1.4230 to $1.4370. Spot February rose 0.05 cent to settle at $1.4630, with the rest ending down 0.10 to 0.35 cent. Comex estimated final copper volume at 9,000 lots, down from 11,423 on Friday's turnover.
"Today was pretty much a non-event. There was a little selling this on the weaker euro, but that quickly dried up when they saw the $190 backwardation on cash to three months copper (in London)," said one trader. Tight nearby copper supply on the London Metal Exchange got even tighter on Monday, with the premium of the cash price over metal delivered in three months hitting $187, its highest in more than eight years.
At the start of 2005, the spread was at $115. Traders cited physical shortages, low stocks and an absence of lenders for the tight supply conditions. The dollar, which hit copper, was only slightly stronger on Monday afternoon, as some currency traders began to focus on the upcoming Federal Reserve policy-setting committee meeting, a the meeting of G7 finance officials, and the US December payrolls report, all due later this week.
Some participants in metal markets brushed aside copper-supportive US data, like the jump in US personal income, and the hefty increase in consumer spending. Later, copper traders also ignored a 0.1 percent increase in US December new home sales.
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