Jul 18, 2012 (Dow Jones) NEW YORK--Copper futures followed equity markets to settle higher Wednesday as data showing improvement in the pace of U.S. residential construction bolstered investor confidence.
The most-actively traded contract, for September delivery, settled 1.85 cents, or 0.5%, higher at $3.4740 a pound on the Comex division of the New York Mercantile Exchange.
Copper prices climbed into positive territory on monthly U.S. housing-starts data, which registered a 6.9% rise in construction starts of new homes in June from May. This beat forecasts of a 5.2% gain. The seasonally adjusted annual rate reached 760,000 last month, the strongest since October 2008.
Copper is mainly turned into electrical wires and plumbing pipes, and construction is a key application area for these products.
A firmer tone in U.S. stock markets also gave copper a boost, as both assets are sensitive to economic outlook. The Standard & Poor's 500 stock index was recently up 0.7% at 1372.59.
Copper-market participants spent much of the day focused on Washington, where Federal Reserve Chairman Ben Bernanke concluded the second and final day of his semiannual testimony to Congress.
Investors who had hoped to see Mr. Bernanke signal that fresh stimulus measures were on their way were left disappointed after the central banker reiterated concerns about slowing growth but refrained from disclosing new policy initiatives.
Mr. Bernanke "hinted that they're leaving the door open" to more stimulus measures, said Bob Haberkorn, senior futures broker with RJO Futures.
Mr. Haberkorn added that copper futures are unlikely to keep Wednesday's gains and that prices are instead likely to test the $3.43 level of technical support.
"I don't see any reason why it wouldn't trade down to $3.43," Mr. Haberkorn said.
Copper settlements (ranges include electronic and pit trading):
Jul $3.4730; up 2.00 cents; Range $3.4390-$3.4730
Sep $3.4740; up 1.85 cents; Range $3.4350-$3.4835