Copper Futures Rise on Consumer Confidence Boost and Weaker Dollar

Strategic Insights -

Copper futures rose for a second day, driven by better-than-expected U.S. consumer confidence data and a weaker dollar. The December copper contract on the Comex division of the New York Mercantile Exchange settled at $3.3760 a pound, up 1.55 cents or 0.5% from the previous day. The surge in copper prices was also influenced by a more upbeat tone in euro-zone markets, as investors viewed an Italian bond auction as mostly successful. The dollar's decline added support to dollar-denominated copper futures, making them cheaper for buyers using other currencies.

Key Takeaways:

  • Copper futures rose 1.55 cents or 0.5% to settle at $3.3760 a pound on the Comex division of the New York Mercantile Exchange.
  • The increase in copper prices was driven by better-than-expected U.S. consumer confidence data, which surged in November to the highest level since July.
  • Copper is particularly sensitive to the growth outlook because of its uses in everything from wiring and piping to consumer electronics.
  • Investment funds more than doubled their net bet against copper futures during the week ended Nov. 22, according to data released late Monday by the Commodity Futures Trading Commission.
  • Large investors in the CFTC's money managers category held more bets that prices would fall than bets that they would rise for a 10th consecutive week.
  • Copper production at Chilean copper mine Dona Ines de Collahuasi has been reduced as a labor strike there entered its second day, the company said Tuesday.
  • The labor strike at Collahuasi, the world's third-largest copper mine, is expected to impact global mine output, which accounted for about 3% of the world's copper output last year.

Statistics:

  • Copper futures rose by 1.55 cents (0.5%) to settle at $3.3760 a pound.
  • The U.S. consumer confidence index surged in November to the highest level since July.
  • Investment funds more than doubled their net bet against copper futures during the week ended Nov. 22.
  • Large investors in the CFTC's money managers category held more bets that prices would fall than bets that they would rise for a 10th consecutive week.
  • Copper production at Dona Ines de Collahuasi has been reduced, which is expected to impact global mine output that accounted for about 3% of the world's copper output last year.

Sources:

  • Dow Jones Commodities News via Comtex
  • Commodity Futures Trading Commission
  • Dow Jones Newswires
  • Anthony Esposito and Carolina Pica contributed to this article.