On Monday, copper contracts’ prices had jumped towards a fresh 10-year peak as investors remained Panglossian about a rapid economic recovery alongside a jump in manufacturing activities in the United States and China, the world’s first- and second-largest economies.
In point of fact, in the day’s upsurge in copper futures’ prices came in on the back of an upbeat Q1 GDP growth in China, while US consumer confidence stepped up along with new orders for core capital goods and services.
Aside from that, a sharply softening US Dollar Index (DXY) that pummelled as much as 0.54 per cent to 91.04 on late-afternoon US trading hours alongside high-flying global equity markets which recorded all-time closing highs on Monday again, cemented ways for the industrial metal contracts’ prices to hit a new 10-year peak.
Bullish investors rally copper futures towards fresh 10-year peak
Citing statistics, in the day’s London Metal Exchange (LME) closure, benchmark LME copper wrapped up the day 1.8 per cent higher to $9,379.50 per ton after hitting a session high of $9,436, the strongest level since February 25 and just a notch shy of its highest since 2011.
Meanwhile, adding that the copper futures’ prices would soon hit $10,000 a ton, a Saxo Bank analyst Ole Hansen wrote in a client note, “That February high” - $9,617 - “will be tested sooner or later”.
Apart from that, citing a flurry of key fundamentals backing up copper contracts’ prices such as a stronger economic recovery on the deck amid an ebullient market, a squeezed supply chain alongside a likely demand-surge, analysts at ING wrote, “Upside risks (may) dominate for copper during 2Q21, suggesting the red metal could be on a parabolic run, testing previous highs.
” Among other industrial metals, LME aluminium winded down the day 0.8 per cent up at $2,332.50 per ton and lead gained 0.5 per cent to $2,055.50 a ton, while tin was treading water at $26,610.