Copper futures were rallying Monday as traders bet that declining metal stores and work stoppages at producing mines would support higher prices.
Benchmark copper contracts recently were up 7 cents at $3.49 a pound on the Comex division of the New York Mercantile Exchange.
PowerShares DB Base Metals
exchange-traded fund, which tracks prices of industrial metals, was climbing 0.7%.
"A plethora of supply-side issues, including strikes and falling inventories, is driving the rally," says Robin Bhar, a base metals strategist at UBS in London.
consumer price index figures from last week is helping also," as it lowers the chance of an interest rate hike by the
, he explains. Rising rates would increase the cost of borrowing, dampening economic activity and decreasing the demand for copper.
In the metals patch, diversified mining giant
might make a bid to buy
, according to a report in
newspaper in London. Alcoa itself is looking to purchase Canada's
BHP was up 1.6%, and Alcoa rose 2.6%. Alcan eased 0.7%.
Freeport-McMoRan Copper & Gold
were down 0.1% in recent action despite the buoyant copper price.
As for precious metals, gold was edging higher by $1.50 at $660.20 an ounce, while silver was up 9 cents at $13.35 an ounce. The weakness of the dollar against the euro was driving the action. The exchange-traded funds that hold bars of the metals,
streetTracks Gold Shares
iShares Silver Trust
, were up 0.3% and 0.5%, respectively.
One euro was recently buying $1.3402, up from $1.338 late Friday. The greenback was worth 123.56 yen, up from 123.47 previously. Over time, the price of gold tends to lift as the value of the dollar declines.
Elsewhere, South Africa's
is reported to have temporarily shut down operations at its Rustenburg facility in an effort to improve safety, according to widespread press reports. The move was helping lift prices of platinum $8 to $1,294 an ounce recently.