MW: Copper rises on fading swine-flu fears; gold also lifted
Copper advanced Wednesday for the first session in three, as fading fears over the potential impact of swine-flu on global growth helped lift most commodities, including gold.
May copper gained 5.25 cents, or 2.7%, to $1.9685 a pound on the Comex division of the New York Mercantile Exchange. Gold for June delivery gained $3.10, or 0.4%, to $896.70 an ounce.
In other markets, U.S. stocks and crude-oil futures moved higher. Gains in commodities and stocks came despite that the Commerce Department reported the U.S. economy contracted more than expected in the first quarter.
Copper was rising "as a rebound in global equity markets coupled with another hefty drop in copper inventories has steadied the complex across the board," said Edward Meir, an analyst at MF Global. "A weaker dollar is also adding support."
Copper inventories at London Metal Exchange fell to 420,275 tons Tuesday, down 5,000 tons from a day ago, according to data from the exchange.
In gold trading, prices earlier rose above $900 Wednesday after two days' decline.
With gold rising above the psychologically important $900 an ounce level, "the metal is expected to run into further technical resistance, with a break above $916 still required to break the current down-trend," said James Moore, an analyst at TheBullionDesk.com.
Gold has not benefited from current uncertainties triggered by the outbreak of swine flu. The June contract had dropped 2.2% in the previous two sessions.
In gold exchange-traded funds, holdings in SPDR Gold Trust , the biggest gold ETF, stood at 1,104.45 tons on Tuesday, unchanged for a fourth session, according to the latest data from the fund.
In other metals, May silver rose 29.5 cents, or 2.4%, to $12.695 an ounce. June palladium added $2.25, or 1%, to $219 an ounce.
Bucking the trend, July platinum lost $5.60, or 0.5%, to $1,096 an ounce.
U.S. GDP
Gloomy economic news in the U.S. didn't dampen investment sentiment Wednesday.
U.S. gross domestic product fell 6.1% in the first quarter from a year ago, nearly matching the 6.3% decline in the fourth quarter of 2008. Analysts had expected a decline of about 5%.
The two-quarter contraction in the U.S. economy is now the worst in more than 60 years, according to the Commerce Department.
Since the 1947, the economy had never contracted by more than 4% for two consecutive quarters. With a 0.5% drop in the third quarter of 2008, it's the first time the economy has contracted for three consecutive quarters since 1975. See full story.
Also helping metals move higher Wednesday, the dollar fell against most of its rivals, with investors waiting for the conclusion of the meeting of Federal Reserve policy makers. See Currencies.
A weaker greenback tends to push up dollar-denominated commodities prices.
