SINGAPORE, Aug. 5 -- Copper gained for a fifth day, advancing to the highest in 10 months, after better-than- estimated U.S. housing data added to signs the global recession is easing. Zinc and nickel climbed to 11-month highs.
The National Association of Realtors said pending home sales in the U.S. increased for a fifth month, with the number of contracts to buy previously owned homes rising 3.6 percent in June, exceeding the consensus forecast for a 0.7 percent gain. Builders are the biggest users of copper in the U.S., the world's second-largest consumer.
"It's a general feeling of optimism across the equities and commodities markets that is driving prices higher," Yuan Fang, a trader Shanghai East Asia Futures Co., said today. "There's a lot of money flowing into the markets these days as risk appetite returns with improved economic data."
Copper for three-month delivery on the London Metal Exchange advanced 1.6 percent to $6,145 a metric ton, the highest price since Oct. 2., at 11:12 a.m. in Singapore.
Copper for September delivery on the Comex division of the New York Mercantile Exchange traded unchanged at $2.7955 a pound, while November-delivery copper on the Shanghai Futures Exchange added as much as 2.3 percent to 48,880 yuan ($7,156) a ton, the highest price since Oct. 6.
Still, the fundamental picture may not be able to support copper prices at more than $6,000 a ton and a "huge correction" lies ahead, said Yuan. Stockpiles monitored by the London Metal Exchange climbed to 285,900 tons yesterday, nearly double levels a year ago.
Among other LME-traded metals, zinc rose as much as 2 percent to $1,890 a ton, the highest price since Sept. 15, and nickel gained 2.1 percent to $19,750 a ton, the highest price since Sept. 4. Aluminum added 1.1 percent to $2,013 a ton, lead added 1.3 percent to $1,945 a ton, while tin hadn't traded as of 11:19 a.m. in Singapore.