New York copper futures ended up just over 1 percent on Wednesday after a drop in London copper inventories and threat of a looming strike in Peru spurred investors back into the market. A surge in US durable goods orders for March also boosted sentiment in metals and other commodities although lagging sales of new homes took some wind of out that.
Most-active copper for July delivery on the New York Mercantile Exchange's Comex division ended up 4.15 cents, or 1.16 percent, at $3.6055 a lb. Its high for the session was $3.62 while the low was $3.5340. July copper had settled down 2.2 percent on Tuesday, after falling as much as 3 percent on more bearish news about the US housing industry.
Copper is widely used in electrical wiring and telephone cabling of homes. Analysts said Wednesday's market was supported by news that copper stocks on London Metal Exchange warehouses had fallen 2,925 tonnes to stand at 163,200 tonnes just about three-days of global consumption. London Metal Exchange copper stocks have dropped by some 25 percent since the start of February.
The tight inventories, as well as record demand for China, have sent Comex copper prices soaring by more than 40 percent in the same period. On Wednesday's market was also underpinned by a plan by Peruvian miners to launch an indefinite, nation-wide strike on April 30 to demand better pension benefits and end to outsourcing.
Peru is the world's third largest copper producer. "The market is pretty much showing underlying strength on the fact that Peru could go out on a strike on Monday," said Steve Platt, analyst at Archer Financial Services in Chicago. "In the background, you have the LME stock fall and a relatively strong world economy, which continues to support robust demand."
Comex copper for nearby delivery in May closed up 3.35 cents at $3.586. The rest of the board settled 3.50 to 5.10 cents higher. Final estimated open-outcry trading volumes for copper futures reached 16,558 lots, against on Monday's total market volume of 20,004 lots. As of April 24, open interest in copper futures rose 1,721 lots to 80,138 contracts. LME copper for delivery in three months closed up $30 at $7,850 a tonne. It had fallen $190 on Tuesday.
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