U.S. Commodities: Copper Rebounds on Demand Outlook for China
By Claudia Carpenter
Jan. 5 (Bloomberg) -- Copper prices rose the most in seven
weeks on renewed optimism that China's economy is growing fast
enough to spur demand for metals, even as the government takes
steps to slow consumption.
China, the world's biggest user of copper, led a surge in
global demand that eroded inventories and sent the price of the
metal to a 15-year high in October. Copper plunged 8.9 percent
yesterday on concern that gains in the dollar and declining prices
in China might signal reduced demand from manufacturers.
``People are positioned to see a bounce in economic activity
in China,'' said Steven Allen, who manages $21 million at the
Preservation Capital Fund in Frankfort, Illinois, including $3
million of commodity-based equities. ``Given the magnitude of the
sell-off, the market was definitely due for a bounce.''
In other markets, crude-oil prices dropped after U.S. fuel
inventories rose last week, signaling that a mild winter is helping
ease demand for heating oil. Cattle prices also dropped. The energy-
weighted Goldman Sachs Commodity Index gained 2.94 to 305.86.
Copper futures for March delivery rose 3.2 cents, or 2.4
percent, to $1.375 a pound on the Comex division of the New York
Mercantile Exchange, the biggest percentage gain since Nov. 17.
Prices rose 39 percent last year. A futures contract is an
obligation to buy or sell a commodity at a set price by a
specific date. |
