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Copper up on China stimulus hopes, trade talk progress
LONDON copper prices rose as much as 1 per cent on Monday, snapping two days of declines, on expectations of more stimulus measures in top metals consumer China and optimism over Sino-US trade talks.
China said on Monday it would relax residency curbs in many of its smaller cities and increase infrastructure spending to boost economic growth. On Sunday, China also announced measures to encourage financing for small and medium-sized businesses.
In the peak April-May copper consumption season, short position holders are "powerless" as it will be impossible to make a case for weak demand over this period, Chinese brokerage Jinrui Futures wrote in a note. Production growth in China's air conditioning sector, a big consumer of copper, is set to grow by 7.9 per cent this month, it added.
US and Chinese negotiators wrapped up their latest round of trade talks on Friday. The US Trade Representative said significant work remains, but Chinese state media said the two sides made "new progress".
"This Chinese comment may well have triggered some of the metals buying," said Malcolm Freeman, director and chief executive of Kingdom Futures in a note. REUTERS