Copper prices climbed on investor hopes for a recovery in metals demand and the global economy after European Union leaders agreed a massive stimulus plan and positive news emerged about a coronavirus vaccine trial.
Three-month copper on the London Metal Exchange rose 0.8 per cent to $US6,541 a tonne by 1617 GMT on Tuesday, close to the 25-month high of $US6,633 on July 13.
BMO Capital Markets analyst Tim Wood-Dow cited vaccine trials and the EU stimulus package for boosting sentiment and prices but said gains could be capped by the current seasonal slowdown in China.
“(Data) shows that western financial markets are already quite long on copper and so from a financial positioning standpoint, the impetus on prices may have run its course for now,” he said.
European Union leaders agreed on a massive stimulus plan for their economies, while early data from trials of three potential coronavirus vaccines showed positive results.
Advisers to US President Donald Trump and congressional Democrats were set to discuss the next steps in responding to the coronavirus crisis on Tuesday, with congressional Republicans saying they were working on a $US1 trillion relief bill.
Speculators upped their net long position in COMEX copper futures by 9,792 contracts to 41,309 in the week to July 14.
After touching a November 2017 high of 18.1 per cent of open interest on Monday last week, the LME Copper net speculative long eased slightly to 15.7 per cent on Friday, broker Marex Spectron estimates.
Refined domestic copper prices fell 2.1 per cent to 51,375 yuan a tonne from a 25-month high hit in the previous session, the latest SMM data showed.
LME aluminium rose 1.9 per cent to $US1,686 a tonne, zinc was up 1.9 per cent at $US2,242.50, lead rose 0.2 per cent to $US1,844, tin added 1.1 per cent to $US17,555 and nickel gained 1.1 per cent to $US13,367.