Copper futures climb to 9-month high after euro zone PMI data
On the Comex division of the New York Mercantile Exchange, copper futures for March delivery traded at USD3.413 a pound during European morning trade, up 0.5%. Comex copper prices rose by as much as 0.8% earlier in the day to hit a session high of USD3.424 a pound, the strongest level since April 12.
Copper prices were likely to find support at USD3.366 a pound, the low from December 31 and resistance at USD3.432 a pound, the high from April 12. There was no floor or electronic trading on Wednesday because of the New Year's Day holiday.
Trading volumes are expected to remain light due to the holiday period, reducing liquidity in the market and increasing volatility, which can help exaggerate market moves.
In the euro zone, Markit research group said its final manufacturing purchasing managers' index for the bloc held steady at a 31-month high of 52.7 in December, unchanged from a preliminary reading and up from 51.6 in November.
A separate report showed that Germany's manufacturing PMI rose to a 31-month high of 54.3, up from a preliminary estimate of 54.2 and improving from 52.7 in November.
Spain's manufacturing sector returned to expansion territory last month, while the Italian manufacturing sector grew at the fastest pace since April 2011, fuelling optimism over the economic outlook of the euro zone's third-and-fourth largest economies.
France moved in the opposite direction, however, with data showing that the contraction in the country's manufacturing sector deepened in December.
Europe as a region is third in global demand for the industrial metal.
Gains were limited as traders also digested a pair of disappointing reports on the Chinese manufacturing sector. Data released earlier showed that China's final HSBC Purchasing Managers Index inched down to 50.5 in December from a reading of 50.8 in November.
The report was published one day after a government report showed that China's manufacturing purchasing managers' index fell to a four-month low of 51.0 last month from 51.4 in November and worse than forecasts for a decline to 51.2.
The Asian nation is the world's largest copper consumer, accounting for almost 40% of world consumption last year.
Market players looked ahead to U.S. data on manufacturing activity and weekly jobless claims later in the day, to gauge the economic strength of the world's second largest copper consumer.
Copper prices have been well-supported in recent weeks amid indications the U.S. economic recovery is deepening. The U.S. is second behind China in global copper demand.
Elsewhere on the Comex, gold for February delivery jumped 1.4% to trade at USD1,218.80 a troy ounce, while silver for March delivery surged 3% to trade at USD19.95 a troy ounce.
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