Copper is up Wednesday, with analysts pointing to market activity in China as the most probable cause. Binary Tribune reported that copper contracts for December, which are the most-traded contract in New York, stood at $3.0315 per pound, up 0.80 percent for the day, though it also logged the lowest price in five months at $3.
The HSBC and the Chinese government reported factory growth in China. The growth, however, was so minimal according to HSBC that copper was forced to the downside. The Tribune noted that the factory sector is one of the leading indicators of copper demand and China accounts for about 40 percent of copper demand in the world.
“The mood here is pretty bearish. It looks like people are expecting this market to trend down to its March lows, below $3 a pound,” said Bob Haberkorn, a broker at RJO Futures.
In addition to halting growth in China’s factory sector and economy as a whole, NASDAQ reported that the strong U.S. dollar may also be keeping copper down, as it generally lessens the appeal of dollar denominated commodities because it makes them more expensive to hold.
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