LONDON, Aug 25 – Copper prices rose on Thursday on a weak dollar and a fresh injection of stimulus from China that could fuel infrastructure projects and boost demand.
* Three-month copper on the London Metal Exchange (LME) was up 1.15% at $8,126.50 a tonne at 1109 GMT, after falling 1.1% a day earlier.
* Copper has rallied 17% since hitting a 20-month low on July 15, but is down 25% from an all-time high hit in March.
* To boost its economy, China has added 19 new policies to existing measures, including increasing the share of political finance tools by 300 billion yuan (43.69 billion US dollars).
* “Some people have worried about the lack of infrastructure growth, in addition to the weakness of the property market, so this certainly provides much-needed help,” said Xiao Fu of Bank of China International in London. “In terms of scale it’s not comparable to what we saw in 2009, it’s more specific, but it’s still useful nonetheless. They don’t want to have a big bazooka at the moment.”
* China’s power shortage highlights the need to invest more in the power grid, which will lead to a rebound in demand for copper and aluminum, the ANZ said in a note.
* Also supporting the market was a weakening dollar index, which makes commodities priced in the US currency cheaper for buyers using other currencies.
* In other base metals, aluminum on the LME was down 0.1% at $2,428.50 a tonne; zinc rose 1.1% to $3,551.50; lead gained 0.7% to $1,986.50; nickel was up 0.8% at $21,530; and tin was up 0.7% at $24,450.
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