Copper Rises Most in Two Weeks on China, U.S. Economic Signals

By Joe Richter and Agnieszka Troszkiewicz – Nov 1, 2012

Copper futures jumped the most in two weeks on signs that economies are stabilizing in China, the top consumer of industrial metals, and the U.S., the second-biggest.

An official Chinese purchasing managers’ index released today rose to 50.2 in October from 49.8 in September, indicating the first expansion in three months. Readings above 50 signal growth. Manufacturing in the U.S. last month expanded more than economists forecast, and construction spending in September climbed to the highest in almost three years. Prices are up 2 percent since reaching a seven-week low on Oct. 29.

“We’re seeing somewhat better economic data, and it looks like the worst may be behind us for the most part,” Frank Cholly, a senior commodity broker at RJO Futures in Chicago, said in a telephone interview.

Copper futures for December delivery climbed 1 percent to settle at $3.552 a pound at 1:15 p.m. on the Comex in New York, the biggest gain for a most-active contract since Oct. 17. Last month, the metal fell 6.4 percent, the most since May.

The metal also climbed after a report showed companies expanded payrolls in the U.S. last month by the most in eight months. The increase of 158,000 followed a revised 114,000 gain in September, ADP Research Institute data showed.

Labor Department figures tomorrow may show employers took on 125,000 workers in October, not enough to keep the jobless rate from rising to 7.9 percent from 7.8 percent, according to the median estimate in a Bloomberg survey of economists.

“The market is focusing on numbers that are better than expected today, but we’ll have to wait for the payroll numbers tomorrow” to see if the gains hold, Adam Klopfenstein, a senior market strategist at Archer Financial Services Inc. in Chicago, said in a telephone interview. “Copper is probably going to be stuck in a trading range until after the election.”

The U.S. presidential election is on Nov. 6.

On the London Metal Exchange, copper for delivery in three months rose 0.9 percent to $7,826 a metric ton ($3.55 a pound). Aluminum, nickel, lead, zinc and tin also advanced.

To contact the reporters on this story: Joe Richter in New York at jrichter1@bloomberg.net; Agnieszka Troszkiewicz in London at atroszkiewic@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net