Aug. 16 (Bloomberg) -- Copper futures rose to a 10-week high on speculation that demand will increase in the U.S. and China amid declining global inventories. Zinc rose to a five- month high.
U.S. housing starts rose 5.9 percent in July, government data showed today. In China, factory output last month jumped more than estimated in China, data showed on Aug. 9, and copper premiums remained close to an all-time high after delayed shipments tightened local supplies, CRU International Ltd., a research company said today. World stockpiles dropped for the eighth straight week.
“Most of this rally was originally fueled by China numbers and growth and continued drawdowns in stocks,” Frank McGhee, the head dealer at Integrated Brokerage Services LLC in Chicago, said in a telephone interview. “You’ve got a tightness in the Chinese market.”
Copper futures for December delivery rose 0.8 percent to settle at $3.367 a pound at 1:21 p.m. on the Comex in New York. Earlier, the price reached $3.3835, the highest for a most- active contract since June 5. The metal climbed for the third straight week, the longest rally in three months.
China is the world’s biggest consumer of the metal, followed by the U.S. The Copper Development Association says that construction generates about 40 percent of demand.
On the London Metal Exchange, copper for delivery in three months climbed 1.2 percent to $7,400 a metric ton ($3.36 a pound). The price has dropped 6.7 percent this year.
Zinc on the LME rose 2.4 percent to $2,006 a ton after reaching $2,009, the highest since March 13.
Aluminum, nickel and lead reached the highest since June, and tin rose.
--Editors: Patrick McKiernan, Thomas Galatola