The Australian reported that copper futures recovered today from recent losses as an appreciation of China's currency and a rally in equities boosted trader sentiment.
The benchmark contract settled above USD 4 for the first time since Friday as futures have struggled to rise following the US credit downgrade and mounting economic worries.
The most actively traded contract, for September delivery rose USD 12 cents or 3.1% to settle at USD 4.0085 per pound on the Comex division of the New York Mercantile Exchange. Stronger metal demand in Asia yesterday added to the market's gains with copper benefiting from China's yuan rising to a new high against the US dollar.
Mr Justin Lennon analyst with Mitsui Bussan Commodities said that "A stronger domestic currency makes copper purchases cheaper, because it gives you greater buying power in overseas markets."
According to the Labour Department, better than expected US jobless claims data lifted equities and copper followed higher. The number of people claiming new jobless benefits fell last week to the lowest level in four months.
Mr Scott Meyers senior trading analyst with Pioneer Futures said that "Copper is truly an industrial metal and it's following the Dow Jones Industrial Average quite closely."
Mr Ralph Preston an analyst with Heritage West Financial said that “The metal moved in sync with equity markets, but with a technical view the copper market's disposition is "still absolutely slanted to the downside."
He called the latest move a temporary bounce and said futures need to close over USD 4.09 to hint at a sustained recovery.
