Copper Closes at Record High

[theo]

According to coinflation the pre-1982 Lincoln penny is just a shade below 3 Xs face. How high will it have to go before our hobby goes mainstream?


http://www.marketwatch.com/story/copper ... teid=yhoof

SAN FRANCISCO (MarketWatch) — Copper futures closed at a record high Tuesday, rallying as investors best on stronger demand for the industrial metal after a gauge of U.S. manufacturing activity rose to its highest in nearly seven years.

Gold futures climbed as a drop in the U.S. dollar to its lowest level since November made the precious metal more attractive to investors.

Copper for March delivery /quotes/comstock/21e!f1:hg\h11 (HGH11 453.95, -0.75, -0.17%) rose 9 cents, or 2%, to end at $4.547 a pound — the metal’s highest closing level ever on the Comex division of the New York Mercantile Exchange.

All eyes on Suez CanalGuy Chazan reports oil markets are nervously keeping an eye on the unrest in Egypt and how it might affect the Suez Canal and Sumed pileline, which combined carry upwards of 3 million barrels of oil a day.
“Demand [for copper] looks stronger … than people expected,” said Catherine Virga, base metals analyst at CPM Group in NY.

Add to that a weaker dollar and positive momentum since the Chicago PMI index release on Monday and “I am not surprised at all to see these record levels now,” she said.

The Institute of Supply Management said Tuesday that its index of manufacturing activity rose the most since May 2004. The ISM index rose to 60.8% in January from 58.5% in December. Read more about the ISM data.

Copper could trade as high as $4.75-$5 a pound over the course of the year, said Virga.

Falling supply levels were also a key factor for copper’s rise.

In a note to clients, analysts at Commerzbank said the global supply deficit on the copper market “should widen significantly” and that some market observers see a deficit of more than 800,000 metric tons for the current year. “The price rally of metals, especially copper and tin, is therefore set to continue.”

Copper settled at $4.458 Monday, tying with Jan. 3 for a record settlement. It had traded within a tight range in previous weeks partly on the lack of Chinese buying ahead of China’s New Year celebrations this week, analysts at Bank of America-Merrill Lynch said in a report to clients.