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By Eric Onstad
LONDON, Feb 28 (Reuters) – Copper prices rallied on Tuesday as speculators adjusted positions on hopes of a pick-up in demand in China, the world’s biggest consumer of the metals.
Benchmark copper on the London Metal Exchange (LME) rose 1.9% to $8,965.50 a tonne as of 1700 GMT, after rising 1% on Monday. However, the contract lost 2.7% per month, its first decline since October.
* U.S. Comex copper futures rose 2.1% to $4.09 a pound.
* Copper on the LME rebounded from a level important to investors watching for technical signals, said Ole Hansen of Saxo Bank in Copenhagen. The gains were due to profit taking by speculators with short positions, as well as new long positions by investors taking advantage of a cheaper level to enter the market, he added.
* “I’m relatively optimistic about the price action, especially since the rebound has been at a technically significant level,” Hansen said. “It indicates that the weakness we have seen is more of a correction within a market that wants to go higher.”
* At Monday’s low, LME copper fell 9% after hitting a seven-month high in January of $9,550.50 a tonne. In January, the red metal rose largely on hopes that the easing of China’s strict COVID-19 controls would boost demand.
* Chinese copper demand remained weak in February, weighing on prices, but analysts expect China’s economy to rebound strongly from March as the government is likely to roll out more stimulus there National People’s Assembly.
* In other precious metals, LME aluminum rose 0.4% to $2,371.50 a tonne; zinc gained 0.6% to $3,006.50; nickel fell 3.2% to $24,685; Lead fell 0.3% to $2,105.50; and tin fell 2.6% to $24,805.
* To view base metal futures prices:
– COPPER
– LEAD
– TIN
– NICKEL
– ALUMINUM
– ZINC
(Additional reporting by Mai Nguyen in Hanoi; Spanish editing by Carlos Serrano and Manuel Farías)