Investing.com - Copper futures were higher on Thursday, on hopes the Federal Reserve will maintain its bond purchases for longer and after data showed that profit growth at Chinese industrial companies accelerated in May.
On the Comex division of the New York Mercantile Exchange, copper futures for September delivery traded at USD3.069 a pound during European morning trade, up 0.9% on the day.
New York-traded copper prices rose by as much as 1.1% earlier in the session to hit a daily high of USD3.073 a pound.
The Commerce Department said Wednesday that U.S. gross domestic product expanded at an annual rate of 1.8% in the three months to March, below an earlier estimate of 2.4% growth. Economists had expected the rate of growth to remain unchanged at 2.4%.
The disappointing data eased fears the Fed will begin to taper its bond purchase program in the coming months.
The Fed’s stimulus program is viewed by many investors as a key driver in boosting the price of commodities as it tends to depress the value of the dollar.
The U.S. was to release the weekly government report on initial jobless claims and a report on pending home sales later Thursday.
Meanwhile, copper prices drew further support after official data showed that profits at China’s industrial companies jumped 15.5% in May from a year earlier, higher than April’s 9.3% gain.
Market sentiment received a further boost amid improvement in China’s strained money markets.
Comex copper prices fell to USD2.985 a pound earlier in the week, the weakest level since July 20, 2010, amid growing fears over a cash crunch in the Chinese financial system.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Elsewhere on the Comex, gold for August delivery rose 0.5% to trade at USD1,236.25 a troy ounce. On Wednesday, gold prices slumped more than 4% to touch a low of USD1,221.55 a troy ounce, the weakest level since August 24, 2010.,
Meanwhile, silver for September delivery added 0.5% to trade at USD18.71 a troy ounce. Silver futures tumbled more than 5% on Wednesday to hit a low of USD18.39 a troy ounce, the cheapest level since August 25, 2010.
Moves in the gold and silver prices this year have largely tracked shifting expectations as to whether the U.S. central bank would end its bond-buying program sooner-than-expected.
