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DJ BASE METALS: Comex Copper 3.4586 Climbs on Global Easing Hopes
Sep 04, 2012 By Matt Day

--Comex September copper recently trades up 2.6 cents, or 0.8%, at $3.483 a pound
--Hopes for action from Fed, ECB stoke copper-demand expectations
--Comex floor trading was closed Monday for Labor Day holiday

NEW YORK--Copper futures gained Tuesday on the view that world governments would take steps to support the global economy, potentially kindling more demand for the industrial metal.

Copper futures rose on Friday for the first time in six sessions after Federal Reserve chief Ben Bernanke defended the central bank's previous efforts to jumpstart economic activity. Traders viewed his comments, made at an economic symposium in Wyoming, as the clearest indication yet that the Fed would move to deploy new policies in support of growth.

Central bank support for the economy was on traders' minds again on Tuesday, after European Central Bank President Mario Draghi said that buying government bonds with maturities of as much as three years would be within the bank's mandate, a statement traders read as a hint that the ECB take such steps and buy the debt of distressed EU countries. Yields on Spanish and Italian government bonds dropped sharply in response.

The ECB is set to hold a policy meeting on Thursday, and the Federal Reserve's policy arm meets next week.

Central bank easing, particularly in Europe, should push prices for commodities such as copper higher, analysts with Commerzbank said in a note. Worries that Europe's debt crisis would further rattle global industrial activity has kept a lid on copper prices this year.

The most actively traded copper contract, for September delivery, recently traded up 2.6 cents, or 0.8%, at $3.483 a pound on the Comex division of the New York Mercantile Exchange.

Base metals are "on a rising trend, helped by hopes of more stimulus," said Societe Generale's metal analyst Robin Bhar.

Comex floor trading was closed on Monday for the U.S. Labor Day holiday.

Traders were looking ahead to U.S. economic data on Tuesday. Readings on nationwide manufacturing activity and construction spending are scheduled for release at 10 a.m. EDT.

-Alex MacDonald contributed to this article.

-Write to Matt Day at [e-mail]
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(END) Dow Jones Newswires
09-04-12 0936ET
Copyright (c) 2012 Dow Jones & Company, Inc.

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