Copper climbs up

Economic report adds some glamour to red metal prices

Copper prices rose on Monday, 05 October, 2009 at Comex and LME. Prices rose at Comex following upbeat economic report.

At USA, copper futures for December delivery ended higher by 4.55 cents (1.7%) to 2.727 a pound. Copper dropped 2.2% last week. It was the fifth straight weekly drop for copper. Copper ended September, 2009, higher by 0.4%.

On the London Metal Exchange, copper for delivery in three months ended higher by $6 (0.1%) at $5,886 a metric ton. On 3 July, 2008, prices had touched an all time intra day high of $8,940.

After September, it was the ninth straight monthly gain for copper. On a year to date basis, prices are higher by 85%.

The U.S. buys about 13% of the 17 million metric tons of copper sold annually and China buys about 20%.

The Institute for Supply Management reported on Monday, 05 October, 2009 that the service sectors of the United States expanded in September for the first time in a year. As per the report, the ISM non-manufacturing index rose to 50.9% from 48.4% in August. This is the highest level since May 2008 and the first time in a year that the index was above the break-even 50% mark.

In the currency market on Monday, the dollar index, which measures the strength of dollar against a basket of other currencies, fell by almost 1%. The US Dollar Index traded in negative territory all session, which provided modest price support to some commodities this morning. The dollar fell after finance ministers from the Group of Seven nations made no specific mention of the currency in a communiqué at their weekend meeting.

In FY 2008, copper prices dropped by 54%. Prior to 2008, copper prices ended FY 2007 with a gain of mere 5.5% after a whopping 44% gain in FY 2006. The price of copper gained every year since 2002 as global economic growth boosted demand for the metal used in pipes and wires.

At the MCX, copper for November delivery closed at Rs 286.2/Kg. The closing price was Rs 0.35/Kg (0.12%) higher than previous closing price. Prices rose to a high of Rs 286.75/ Kg and fell to a low of Rs 280.8/Kg during the day's trading.

Among other metals traded in the LME on Monday, lead added 0.75% to $2,145 a ton and zinc added 1% to end at $1,863 a ton. Nickel fell 0.9% to end at $17,250. Aluminium rose 0.6% to $1,794 a ton.