Copper, gold prices rise; start week with optimistic tone

The Comex copper price surged to its highest June 2015 on Monday morning amid persistent fund buying and a pause in the dollar’s rally.

Copper for March delivery on the Comex division of the New York Mercantile Exchange gained one cent or 0.4% to $2.6780 per pound. Earlier, the contract touched $2.7400, its highest since June 2015.

Comex gold for December settlement rose $9.70 or 0.8% to $1,188.10 per oz. Trade has ranged from $1,182.50 to $1,197.20 so far

“There is no sign yet of any real large correction, and as long as the funds are happy to play the long side, the market looks like a good ‘buy’,” a trader said.

The broad-based metals rally started around LME Week, continued through the US presidential election and is still going strong as December nears. Solid manufacturing data from China and the US show both economies are growing at healthy rates and the Chinese government has shown a willingness to maintain accommodative monetary policies to support GDP growth at 6.5-7%.

Another factor in the higher prices is the pause in the dollar’s rally – the dollar index was at 101.52, having been as high as 102.05 in the previous week, its highest since March 2003.

Still, the market is unchanged fundamentally despite the wave of optimism, traders said.

“We remain quietly bullish for the fundamentals because of a stronger China but at these price levels we are not bullish on prices,” Metal Bulletin analyst William Adams said. “We would run with the upward momentum for now but would be wary it may not last too long – perhaps until just after options declaration.”

Turning to European markets, Germany’s DAX and France’s CAC-40 were down 0.7% and 0.8% respectively while the dollar was unchanged at 1.0591 against the euro.

In other commodities, light sweet crude (WTI) oil futures on the Nymex increased 54 cents or 1.2% to $46.60 per barrel, while Comex silver for December settlement at $16.625 per oz was up 15.5 cents.

(Editing by Mark Shaw)

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