Copper futures in New York managed to eke out modest gains on Monday amid a general lack of participation partly due to the debut of a new electronic trading platform for Nymex metal futures contracts, floor dealers said.
"They started the Globes trading today, which just seemed to divert volume from here to there, so now we have two markets that are even thinner than our market was on Friday," said one long-time floor dealer down on the floor of the New York Mercantile Exchange's Comex division. Copper for March delivery ended up 0.40 cent at $3.1760 per lb, holding to a narrow range between $3.1525 and $3.1860.
"The electronic trade definitely took some of the trade away from us down here, but we only had a 3.50-cent range today, so it would have been a slow day anyway," said one trader. Technically, traders pegged support in March copper at $3.10 followed by $3.05 and then at the psychological $3.00 level, while resistance remained at $3.20.
Spot December gained 1.00 cent to $3.1570 and deferred or back month contracts closed up 0.20 to 1.55 cents. Final Comex copper futures volume was estimated at only 6,000 lots, off from Friday's official count of 7,021 lots.
Nymex retired its ACCESS screen trade system, which only operated when the floor was closed. Meanwhile, concerns over the deteriorating growth outlook for the US economy also added to the lack of interest in the market on Monday, as slower growth was seen equating to a hindrance of demand for copper, which is used in electrical applications and construction.
On Friday, the Institute for Supply Management said its index of national factory activity came in below market expectations at 49.5 in November from 51.2 in October. This was the first time in 3-1/2 years the US manufacturing sector has been in contraction.
On the supply-side, London Metal Exchange-monitored warehouse stocks jumped by 4,500 tonnes to 161,225 tonnes on Monday, while Comex stocks fell 328 short tons to 31,299 tons on Friday. Meanwhile, non-commercial players in Comex copper futures held a net short position of 17,636 lots as of Tuesday, November 28, against 18,102 contracts the week before, the Commodity Futures Trading Commission said in its weekly Commitments of Traders report. Fundamentally, Chile's Codelco hopes to begin in January the first phase of expansion at its Andean copper mine, intended to make it one of the top producers at the world's largest copper miner. LME three- months copper closed at $7,000 a tonne, up $25 from Friday's kerb close.
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