Copper may surpass $8,000 for first time since 2008
Tuesday, 6 April 2010
LONDON, April 5 (Bloomberg): Copper futures in London may advance to more than $8,000 a tonne this week for the first time since the collapse of Lehman Brothers Holdings Inc. in 2008, buoyed by a revival in demand that's more than doubled prices.
The metal for three-month delivery on the London Metal Exchange touched $7,939.75 a tonne on April 1, the highest level since Aug. 1, 2008, when it last traded at more than $8,000. LME trading resumes tomorrow after the Easter holiday.
Copper's revival underscores the rebound of the global economy, which was tipped into the deepest recession since World War II by Lehman's collapse and the freezing of credit markets. The commodity, used in houses and autos, can set the pace for other industrial metals such as nickel and zinc.
"We have embedded in our forecasts for copper to go above $8,000 sometime in the second quarter," Yingxi Yu, an analyst at Barclays Capital, said from Singapore today. "Copper's had a robust performance and sentiment is still positive," Yu said, citing declining stockpiles and positive economic data.
Former Federal Reserve Chairman Alan Greenspan said yesterday that there is "momentum building up" in the US economy, the world's second-largest copper user. Manufacturing in China, the largest user of the metal, grew for a 13th month in March, according to data released on April 2.
"We're in the first third of a very strong, sustainable recovery here," Jesper Koll, Tokyo-based head of equity research at JPMorgan Chase & Co., said in a Bloomberg Television interview. "Here in Asia, things are growing very fast."
The metal for three-month delivery on the London Metal Exchange touched $7,939.75 a tonne on April 1, the highest level since Aug. 1, 2008, when it last traded at more than $8,000. LME trading resumes tomorrow after the Easter holiday.
Copper's revival underscores the rebound of the global economy, which was tipped into the deepest recession since World War II by Lehman's collapse and the freezing of credit markets. The commodity, used in houses and autos, can set the pace for other industrial metals such as nickel and zinc.
"We have embedded in our forecasts for copper to go above $8,000 sometime in the second quarter," Yingxi Yu, an analyst at Barclays Capital, said from Singapore today. "Copper's had a robust performance and sentiment is still positive," Yu said, citing declining stockpiles and positive economic data.
Former Federal Reserve Chairman Alan Greenspan said yesterday that there is "momentum building up" in the US economy, the world's second-largest copper user. Manufacturing in China, the largest user of the metal, grew for a 13th month in March, according to data released on April 2.
"We're in the first third of a very strong, sustainable recovery here," Jesper Koll, Tokyo-based head of equity research at JPMorgan Chase & Co., said in a Bloomberg Television interview. "Here in Asia, things are growing very fast."