SF: Copper Rises From Two-Week Low in New York as Stockpiles Shrink
July 19 (Bloomberg) -- Copper prices rose from the lowest level in almost two weeks after inventories dropped for a 22nd consecutive weekday, matching this year's longest streak of declines.
Stockpiles monitored by the London Metal Exchange fell to 422,850 metric tons, the lowest level since Nov. 20. LME supplies are down 16 percent this year, signaling that demand has been steady even as reports suggest the global economy is cooling.
"A slowing in momentum of growth does not mean that the global economy is heading toward imminent disaster, and in some economies it is a welcome sign to avoid overheating," Barclays Capital analysts led by Gayle Berry in London said in a report. "We would recommend buying copper on dips."
Copper futures for September delivery rose 1.15 cents, or 0.4 percent, to $2.941 a pound at 11:28 a.m. on the Comex in New York. Earlier, the metal touched $2.925, the lowest level for a most-active contract since July 6. It also rose as much as 1.1 percent.
The metal pared gains after a private report showed confidence among builders in the U.S. fell to the lowest level since April 2009. Construction accounts for a quarter of all copper consumption, according to the Copper Development Association.
"Housing is still an important factor for copper, so any weakness there will have an impact on prices," said Gijsbert Groenwegen, a partner at Gold Arrow Capital Management in New York. "Copper is in a wait-and-see mode. The next few weeks will be crucial in terms of gauging demand."
Copper for delivery in three months added $27, or 0.4 percent, to $6,512 a metric ton ($2.96 a pound) on the LME.
'Arbitrage Window'
Prices in London fell 4.1 percent last week, leaving it at a discount to the metal traded on the Shanghai Futures Exchange, which dropped 0.8 percent in the same time. Arbitrage traders can profit from buying the metal in London and selling it in Shanghai, pocketing the difference.
"Copper rose overnight as an open arbitrage window saw trade buyers in the market buying LME copper," North said.
Also on the LME, aluminum, nickel and lead price fell. Tin and zinc rose.
