Speculators raised bets on higher metal prices by the most since July, turning bullish on copper for the first time in four months on signs of growth in the U.S., increasing demand in China and more confidence in Europe.
Copper Outlook
Copper futures that dropped to a 14-month low in October are up 10 percent this month, heading for the biggest January rally since 2003. Hedge funds and other money managers had a net-long position of 4,775 contracts last week, after betting on lower prices for 17 consecutive weeks, the longest bearish stretch since July 2009, CFTC data show.
Copper for March delivery increased 1.7 percent to $3.8105 a pound at 10:18 a.m. on the Comex, heading for the biggest gain in a week.
Confidence among U.S. homebuilders, the biggest users of copper, rose in January to the highest level in more than four years, the National Association of Home Builders/Wells Fargo sentiment gauge showed Jan. 18. A typical house uses about 400 pounds (181 kilograms) of copper pipes and wire.
The Federal Reserve reported Jan. 18 that U.S. factory output climbed 0.9 percent last month, the most since December 2010. Unemployment claims dropped by 50,000 to 352,000 in the week ended Jan. 14, the lowest level since April 2008, the Labor Department said on Jan. 19.
Gross domestic product in China, the biggest consumer of everything from zinc to copper to cotton, expanded 8.9 percent in the last three months of 2011 from a year earlier, the slowest pace in 10 quarters, the statistics bureau said Jan. 17.
