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Gold/Mining/Energy : Copper - analysis -- Ignore unavailable to you. Want to Upgrade?

To: Stephen O who wrote (1289)	9/28/2005 3:15:12 PM
From: Stephen O	Read Replies (1) \| Respond to of 2131

Copper Reaches Record $1.75 a Pound on Signals Demand May Rise 2005-09-28 14:00 (New York) By Jennifer Itzenson Sept. 28 (Bloomberg) -- Copper prices rose to a record $1.75 a pound in New York, extending a four-month rally, on speculation demand may rise for the metal used in manufacturing, wiring and construction. U.S. orders for durable goods gained 3.3 percent in August, the fourth increase in five months, the Commerce Department said today in Washington. Damage caused by hurricanes Katrina and Rita may spur further demand for the metal in the coming months, some traders said. Since May 16, copper has gained 30 percent from $1.33 a pound, near the year's low. ``The numbers that came out were a little bit bullish,'' said Scott Meyers, an analyst at Pioneer Futures Inc. in New York. ``The usage is going to go up. There's going to be a lot of building.'' Copper futures for December delivery rose 2 cents, or 1.2 percent, to $1.748 a pound on the Comex division of the New York Mercantile Exchange after reaching the highest ever. Prices have more than doubled in the past two years as demand outpaced supplies. A futures contract is an obligation to buy or sell a commodity at a set price by a specific date. Orders for expensive items made to last at least several years rose to $210.9 billion in August, rebounding from the biggest drop in 18 months in July. Economists expected durable goods orders to rise 0.7 percent to $218.2 billion, based on the median of 64 forecasts in a Bloomberg News survey, after a 4.9 percent drop in July. The durable goods report ``broke the string of relatively poor economic data that have been coming out over the past few weeks,'' said Edward Meir, a commodity analyst with Man Financial Ltd. in Darien, Connecticut. ``It blew all the estimates out of the water.'' Demand Signals Economic data next week will give better signals on the hurricanes' impact on copper demand, Meir said. Reports on construction spending, manufacturing and consumer confidence are slated for next week. Construction is the biggest use for copper. Global demand for copper may exceed production by 85,000 tons this year, Morgan Stanley said in a report last month. Last year, supplies fell short of demand by 760,000 tons, according to the Lisbon-based International Copper Study Group. The Reuters/Jefferies CRB Index of 19 commodities rose for a third straight session, climbing 7.49, or 2.3 percent, to 334.52. It has climbed 19 percent this year, boosted by gains in energy, metals, sugar and cotton. ``Many funds in the market are expecting very strong inflow of quarter-end buying in the commodity markets,'' said Michael Guido, director of hedge-fund marketing and commodity strategy in New York for Paris-based Societe Generale SA. ``Investor money is still looking to buy commodities.'' Shares of Phelps Dodge Corp., the world's biggest publicly traded copper producer by 2004 output, climbed $5.04, or 4 percent, to $130.19 at 1:54 p.m. in New York Exchange composite trading after reaching a record $131.40. Before today, the shares had gained 40 percent in the past year. Chile's state-owned Codelco is the largest copper producer. --Editors: McKiernan, Enoch