Investing.com - Copper futures rose to a six-week high during European morning hours on Wednesday, as sentiment on the industrial metal was boosted after comments from Communist Party chief Xi Jinping fuelled hopes for more stimulus measures in the world’s largest copper consumer.
Traders also continued to focus on talks in Washington to avert the fiscal cliff of spending cuts and tax hikes.
On the Comex division of the New York Mercantile Exchange, copper futures for March delivery traded at USD3.674 a pound during European morning trade, up 0.5% on the day.
New York-traded copper prices rose by as much as 0.75% earlier in the day to trade at a session high of USD3.683 a pound, the strongest level since October 19.
Comments from a meeting of China’s new leaders Tuesday, the first following November’s leadership handover, implied that supportive economic policy would remain in place in China.
Party chief Xi Jinping said that policy makers would continue fine-tuning fiscal and monetary policies to ensure stable growth.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Weakness in the U.S. dollar lent support to prices. The euro hit a fresh six-week high against the greenback, while the dollar index was down 0.1% to trade at 79.57, the weakest level since October 22.
A weaker dollar boosts demand for raw materials as an alternative investment and makes dollar-priced commodities cheaper for holders of other currencies.
Market players were looking ahead to a flurry of economic data out of the U.S. later in the day, as investors attempt to gauge the strength of the country’s economic recovery.
The U.S. was to release a report on ADP nonfarm payrolls, as well as official data on factory orders. In addition, the Institute of Supply Management was to produce a report on service sector activity.
Meanwhile, on Friday, U.S. nonfarm payrolls, which are a key gauge of employment, will be released for November.
Investors also remained concerned over the looming fiscal cliff in the U.S., approximately USD600 billion in automatic tax hikes and spending cuts due to come into effect on January 1, unless a divided Congress and the White House can work out a compromise in the four weeks left before the deadline.
There are fears that U.S. lawmakers will repeat the same political divisiveness that led Standard & Poor's to downgrade the U.S.’s AAA rating in August 2011 and tip the country back into a recession.
Signs of progress in handling the euro zone's debt crisis also boosted investor confidence. Sentiment remained supported after Greece launched a scheme to buy back debt from private investors on Monday, as part of an agreement to reduce its debt load and unlock a new bailout package worth EUR44 billion.
In addition, Spanish and Italian bond yields turned lower after Spain formally requested aid to recapitalize its banks.
Europe as a region is second after China in global demand for the industrial metal.
Elsewhere on the Comex, gold for February delivery rose 0.65% to trade at USD1,706.65 a troy ounce, while silver for March delivery rallied 1.3% to trade at USD33.23 a troy ounce.
Traders also continued to focus on talks in Washington to avert the fiscal cliff of spending cuts and tax hikes.
On the Comex division of the New York Mercantile Exchange, copper futures for March delivery traded at USD3.674 a pound during European morning trade, up 0.5% on the day.
New York-traded copper prices rose by as much as 0.75% earlier in the day to trade at a session high of USD3.683 a pound, the strongest level since October 19.
Comments from a meeting of China’s new leaders Tuesday, the first following November’s leadership handover, implied that supportive economic policy would remain in place in China.
Party chief Xi Jinping said that policy makers would continue fine-tuning fiscal and monetary policies to ensure stable growth.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Weakness in the U.S. dollar lent support to prices. The euro hit a fresh six-week high against the greenback, while the dollar index was down 0.1% to trade at 79.57, the weakest level since October 22.
A weaker dollar boosts demand for raw materials as an alternative investment and makes dollar-priced commodities cheaper for holders of other currencies.
Market players were looking ahead to a flurry of economic data out of the U.S. later in the day, as investors attempt to gauge the strength of the country’s economic recovery.
The U.S. was to release a report on ADP nonfarm payrolls, as well as official data on factory orders. In addition, the Institute of Supply Management was to produce a report on service sector activity.
Meanwhile, on Friday, U.S. nonfarm payrolls, which are a key gauge of employment, will be released for November.
Investors also remained concerned over the looming fiscal cliff in the U.S., approximately USD600 billion in automatic tax hikes and spending cuts due to come into effect on January 1, unless a divided Congress and the White House can work out a compromise in the four weeks left before the deadline.
There are fears that U.S. lawmakers will repeat the same political divisiveness that led Standard & Poor's to downgrade the U.S.’s AAA rating in August 2011 and tip the country back into a recession.
Signs of progress in handling the euro zone's debt crisis also boosted investor confidence. Sentiment remained supported after Greece launched a scheme to buy back debt from private investors on Monday, as part of an agreement to reduce its debt load and unlock a new bailout package worth EUR44 billion.
In addition, Spanish and Italian bond yields turned lower after Spain formally requested aid to recapitalize its banks.
Europe as a region is second after China in global demand for the industrial metal.
Elsewhere on the Comex, gold for February delivery rose 0.65% to trade at USD1,706.65 a troy ounce, while silver for March delivery rallied 1.3% to trade at USD33.23 a troy ounce.