US copper futures rose to their highest nine weeks at Friday's open, with tighter supply/demand fundamentals adding to a post-Fed rally that saw the red metal climb over seven percent on the week, analysts said.
Copper, an industrial metals with close ties to the underlying economy, shot up along with the rest of the metals complex after Tuesday's US Federal Reserve decision to cut benchmark interest rates by a half-point to 4.75 percent.
The move was seen as an effort to kick-start an economy that has been weighed down by a crisis in the subprime mortgage market and continual deterioration in the housing market.
Copper for December delivery was up 0.95 cent at $3.6040 per lb by 10:33 am EDT (1433 GMT) at the New York Mercantile Exchange's Comex division after peaking at $3.6550 which marked its priciest since July 31.
"We're up, following the other metals. It looks good on the charts, with a new high of $3.65 (a lb) this morning. I think they're going to make a stab at $3.70, shortly, and I think we're going to see new contract highs within the week," said Scott Meyers, senior-trading analyst with Pioneer Futures in New York.
Volume amounted to 5,604 lots by 10:00 am Sentiment received an additional boost after news broke on Thursday that unions at Southern Copper in Peru approved a plan to strike starting October 2.
Unions at the Cuajone mine and the Ilo smelter voted in favour of the strike on Thursday, a day after the union at Southern's Toquepala mine sanctioned it. The Cuajone and Toquepala mines together produce about 370,000 tonnes of copper annually, and the Ilo smelter 350,000 tonnes. The production losses highlight the market's overall tightness as indicated by the International Copper Study Group (ICSG) data, which showed the market was 131,000 tonnes in deficit from January to June, against a surplus of 208,000 tonnes in the same year-ago period.
London Metal Exchange (LME) copper warehouse stocks declined by 800 tonnes to 132,575 tonnes on Friday. While Comex copper stocks fell 78 at 20,115 short tons on Thursday. LME copper for delivery in three months last traded at $7,917.50 a tonne, up $27.50 from Thursday's close.