Copper futures rose for a second day, extending the biggest weekly advance in more than seven months amid speculation that the largest consumer of the metal, China, will take further steps to spur economic growth. Meanwhile, gold futures declined to a six-week low, while silver also declined.
On the Comex division of the New York Mercantile Exchange, copper futures for settlement in May surged by 1.41% to trade at $3.035 a pound by 12:19 GMT. Prices shifted in a daily range between $3.037, the strongest level since March 11, and $2.994 a pound. The metal is up 2.9 percent this week, the most since the week ended August 9.
Copper prices drew support after the Chinese Premier Li Keqiang said his country cant ignore “difficulties and risks” from a slowdown in the economy and that China is ready to deal with any economic volatility that occurs this year.
“The market is expecting a wider stimulus by Beijing especially should numbers continue to disappoint,” Andrey Kryuchenkov, an analyst at VTB Capital in London, said by e-mail today, cited by Bloomberg.
However, copper has lost 11% this quarter, the most since the three months through September 2011, on concern economic growth is faltering and default risks are increasing in the world’s largest consumer, China at a time when global supplies are piling.
According to data compiled by the metals researcher CRU, the global surplus of copper may reach 140 000 tons in 2014, almost four times larger than previously estimated as demand in the biggest consumer, China, slows.
Meanwhile, gold futures fell to the weakest level in six weeks, extending its second 5-day period loss, as further signs of recovery in the US backed the case for the Federal Reserve to keep cutting stimulus.
On the Comex division of the New York Mercantile Exchange, gold futures for settlement in June fell by 0.49% to trade at $1 288.50 an ounce by 12:23 GMT. Prices shifted in a daily range between $1 299.40 an ounce and $1 287.40 an ounce, the weakest level since February 13th. Prices are heading for a 3.6 percent drop this week.
Gold is 8% higher this quarter on concern that global growth was faltering and as turmoil over Ukraine left Russia and the West involved in their worst conflict since the end of the Cold War.
The US economy expanded more rapidly in the final three months of 2013 than previously estimated as consumer spending jumped by the most in three years, while initial jobless claims unexpectedly declined last week, curbing demand for the precious metal as a store of value.
Elsewhere on the Comex, silver futures for May delivery fell by 0.19 percent to trade at $19.673 an ounce by 12:24 GMT. Yesterday, the price touched $19.580 an ounce, the weakest level since February 5. Platinum futures for July rose by 0.18 percent to trade at $1 400.85 an ounce. Palladium futures for June delivery surged by 0.57 percent to $764.80 an ounce. On March 24, the price touched $802.40 an ounce, the strongest level in 2-1/2 years amid concern the sanctions on the largest supplier of the metal, Russia may reduce supplies.
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