New York copper posted steep gains early on Wednesday as players with long positions decided to add to them after Monday's sharp decline, especially as the dollar resumed its descent, traders said.
"Most of the news is bearish. The (Peru) strike is over. The only thing I can see is that people got short, if they don't get instant gratification, they cover. I also think some people might be looking to get back in on the long side," one copper broker said, adding that the market was thinned by annual LME Week events in London.
"So, it's pretty easy to push copper around," he said. Copper for December delivery on the New York Mercantile Exchange's Comex division jumped 9.85 cents to $3.7160 a lb. It set a session top at $3.7265 and a higher low at $3.6060. On Monday, it slid to $358.10, a 2-week low.
Estimated 10 am volume was 8,890 lots. Open interest rose by 419 to 86,524 lots as of Monday. In Peru, a strike at Southern Copper's copper mines was called off late on Tuesday after union leaders and company officials signed a settlement pact pushed by the government. The walkout lasted eight days. Under the agreement, workers returned to their jobs on Wednesday morning and the government will set a higher wage rate for labourers in about a week.