LONDON (Reuters) – Copper prices rose on Friday on hopes that U.S. politicians will strike a deal to avoid debt default and investors will adjust positions ahead of the weekend.
* Three-month copper on the London Metal Exchange (LME) was up 1.2% at $8,273 a tonne by 1050 GMT, after falling 1.6% in the previous session.
* Financial markets rallied after Democratic negotiators told President Joe Biden on Friday they were making “steady progress” in talks with Republicans in an effort to avoid a US default.
* A slightly weaker dollar index also supported the market, making US-denominated items cheaper for buyers using other currencies.
* Also, according to a trader, some speculators closed short-term bear positions ahead of the weekend.
* According to analysts, the copper market, however, faces headwinds in the coming weeks, with weak demand in China and a possible recession in the United States and Europe.
* The industrial metal, used as a gauge of economic health, is down about 15% from January highs.
* The outlook for industrial metals in 2023 remains weak, said Sabreen Chowdhary, head of commodities at BMI, noting that China’s recovery is largely being led by the services rather than manufacturing and construction sectors, which have seen the country grow. Historically, there has been economic development.
* Among other base metals, aluminum was up 0.4% to $2,293.50 a tonne on the LME, nickel up 3.9% to $21,740, zinc up 1.6% to $2,499, lead up 1.6% to $2,088 and tin up 1.3% to $25,350.
