BLBG: Copper Rebounds From 3-Year Low in London as Asian Stocks Rally
By Li Xiaowei and Feiwen Rong
Dec. 8 (Bloomberg) -- Copper rose from the lowest in three years in London as Asian stocks rallied on economic stimulus plans in the U.S. and a cut to interest rates in India, boosting sentiment for raw material investment.
Base metal prices advanced as the MSCI Asia Pacific Index gained as much as 4.6 percent to 83.18, the most since Nov. 5, after U.S. President-elect Barack Obama pledged the biggest public works program in about 50 years and India lowered interest rates by 1 percentage point.
“Copper’s rebound followed the gains in the stock market, and was technical as there’s nothing new in fundamentals,” Tan Wentao, research manager at HNA Topwin Futures Co., said today by phone from Shanghai.
Copper for three-month delivery rose as much as 5.6 percent to $3,220.50 a ton on the London Metal Exchange and traded at $3,200 at 3:13 p.m. in Shanghai. It fell to as low as $2,991 on Dec. 5, the first time it has dipped below $3,000 since May, 2005.
The exchange-monitored stockpiles have advanced 51 percent this year as slowing global economic growth crimps demand for raw materials. The copper price is down by 52 percent, heading for the first annual drop since 2001.
“The weakening economic outlook continued to pressure the industrial metals and copper may have a further decline of $300- $500 a ton,” Zeng Chao, analyst at Everbright Futures Co., said in a report today.
February-delivery copper on the Shanghai Futures Exchange closed 1.7 percent higher at 25,130 yuan ($3,656) a ton, after falling the exchange-imposed limit of 6 percent from the previous settlement price.
Aluminum for January delivery in Shanghai rose 0.4 percent to 10,730 yuan a ton, after dropping limit down. Trading of February and March delivery contracts was suspended.
Among other LME-traded metals, aluminum was 3 percent up at $1,535 a ton, zinc rose 3.8 percent to $1,112.25, lead added 4.6 percent to $1,015, nickel jumped 6.1 percent to $9,600 and tin was 4 percent up at $11,850 as of 3:27 p.m. in Shanghai.
To contact the reporter for this story: Li Xiaowei in Shanghai at xli12@bloomberg.net
