Copper, the flagship of the London Metal Exchange (LME) complex, has settled at a 10-day high on the back of upbeat manufacturing data out of China and Europe that fuelled hopes for improving global demand for the red metal.
"The base metals have rallied strongly into Thursday afternoon, with a better-than-expected Chinese PMI and strong European data helping give the complex a boost heading into the afternoon," Standard Bank analyst Leon Westgate said.
At the close of open-outcry trading in the London ring on Thursday, LME 3-month copper was up 1.7 per cent from the previous session's settlement price at $US7,169.50 per metric tonne.
Aluminium closed 0.4 per cent higher at $US2,026 per tonne, while zinc rose 1.1 per cent to $US2,387.50 per tonne. Lead prices closed 1.4 per cent higher on the day at $US2,236 per tonne.
As the world's largest consumer of copper, China accounts for some 40 per cent of global demand for the red metal. HSBC's preliminary China purchasing managers index rose to 52 in July, compared with a final reading of 50.7 in June stoked hopes that robust consumption from the nation would continue, propping up prices. This put the indicator at an 18-month high and well above the neutral 50 mark.
"That the measure increased so much, in what is usually a seasonally weaker period, appears to demonstrate the impact of the mini-stimulus measures rolled out earlier in the year," Mr Westgate said.
"[It] suggests that conditions may strengthen firmer once we head out of the traditionally slower summer period."
The composite purchasing manager's index for the eurozone rose to a three-month high of 54, beating forecasts of 52.9
TGS Price at posting:
33.5¢ Sentiment: Buy Disclosure: Held
