Investing.com - Copper prices rose for the first time in six sessions on Thursday, rebounding from a six-year low as dovish minutes from the Federal Reserve's July meeting dented expectations for a rate hike in September.
Gains were limited as investors continued to monitor movements on China's volatile stock market.
Copper for September delivery on the Comex division of the New York Mercantile Exchange inched up 2.1 cents, or 0.92%, to trade at $2.297 a pound during morning hours in London.
A day earlier, copper plunged to $2.260, a level not seen since July 2009, before ending at $2.276, down 1.1 cents, or 0.48%.
Minutes of the Federal Reserve's July meeting published on Wednesday showed that policymakers express broad concerns about lagging inflation and the weak global economy, leading some investors to question the likelihood of a rate hike in September.
The minutes added that Fed officials were concerned about "recent decreases in oil prices and the possibility of adverse spillovers from slower economic growth in China."
The Shanghai Composite took investors on another volatile ride on Thursday, falling by as much as 2.2% after the open, before paring losses after the midday break, and then plunging again in the last hour of trade to end down 3.4%.
Chinese stock markets sold off sharply earlier in the week amid growing concerns over the health of the Asian nation's economy and worries that Beijing may allow the yuan to continue to depreciate, fueling fears over a currency war that could destabilize the global economy.
Market players are also concerned that the plunge in the stock market could spread to other parts of the Chinese economy, triggering fears that the Asian nation's demand for the industrial metal will decline.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Elsewhere, gold futures for December delivery rallied $10.60, or 0.94%, to trade at a five-week high of $1,138.60 a troy ounce as prospects for a rate hike in September by the Federal Reserve appeared dim after the release of July meeting minutes.
Traders now looked ahead to U.S. data later in the session for further indications on the strength of the economy and the timing of an interest rate hike.
The U.S. is set to release data on initial jobless claims, existing home sales and manufacturing activity in the Philadelphia region later Thursday.
Despite a recent batch of upbeat economic data, some traders believe the Fed could postpone raising interest rates next month as officials are likely to remain concerned over global growth and inflation pressures due to China’s shock currency devaluation move and weak commodity prices.
Gold fell to a five-and-a-half year low of $1,072.30 on July 24 amid speculation the Fed will raise interest rates in September for the first time since 2006. But prices have since rebounded almost 6% on hopes of a delayed U.S. rate hike.
The US dollar index, which tracks the greenback against a basket of six major rivals, was down 0.1% to 96.36 early Thursday, after falling sharply on Wednesday, as investors pushed back expectations on the timing of an initial rate hike by the Fed to December, instead of September.