Oil, gold, copper rise on European debt agreement

KUALA LUMPUR, Oct 27 (Reuters): Commodities rose Thursday, led by crude oil and metals, after European leaders reached a deal with private holders of Greek debt to write down half their holdings and also boosted the region's financial stability fund. Brent crude rose for the first time in three days, spot gold climbed to the highest in more than a month and copper on the London Metal Exchange increased for a second day, headed for its biggest monthly gain in 10 months. "The headlines provide some solace to markets," said Thomas Lam, Singapore-based group chief economist at OSK-DMG, a venture between OSK Holdings and Deutsche Bank. "Broadly, it's still a very incomplete picture. There's the question of how long it would take to iron out this plan." Brent jumped $1, or 0.9 per cent, to $109.91 a barrel at 0349 GMT. US oil climbed $1.56, or 1.7 per cent, to $91.76 a barrel. Euro zone leaders struck a deal with private banks and insurers on Thursday for them to accept a 50 per cent loss on holdings of Greek government bonds as part of a plan to lower Greece's debt burden and try to contain the two-year-old euro zone crisis. Three-month copper on the London Metal Exchange rose 1.7 per cent to $7,813.25 a tonne, after rising 2 per cent and touching a one-month high in the previous session. The metal is also being supported by labour disputes at two Freeport MacMoRan Copper & Gold mines that led to a declaration of force majeure at the company's Grasberg mine on Wednesday. Copper had lost a quarter of its value in the three months through September, making it one of the worst performers among commodities during that period. The industrial metal has rebounded as strikes disrupted output, with prices already up 11 percent so far this quarter. "Encouraging headlines on an agreement on measures to find a solution to the euro zone sovereign debt crisis seems to be the main driver," said Citigroup analyst David Thurtell. Spot gold rose 0.3 per cent to a one-month high of $1,728.11 an ounce, heading for its fifth session of consecutive gains, the longest winning streak in more than two months. Data Wednesday showed demand for a range of long-lasting US made goods rising at the fastest pace in six months in September and new homes sales for the same period the strongest in five months. The release of the US third-quarter gross domestic product figures on Thursday will be on investors' radar for any sign of economic expansion in the world's largest economy.