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FINANCIAL MARKETS : Commodities : Copper Futures Prices Rise Amid Concern Over Supplies

From Associated Press

Copper futures prices posted significant gains Monday at the New York Commodity Exchange on concerns about tight supplies.

On other markets, unleaded gasoline led a modest rally in energy futures, sugar futures were clobbered by profit taking and live hog futures advanced on speculation that marketings would drop as farmers concentrated on spring planting.

The move in copper followed an erratic performance last week, when the metal skyrocketed last Wednesday on the heels of five straight slumping sessions.

Copper at the Comex began the day strong, shrugged off reports of higher than expected stocks at the London Mercantile Exchange, broke an important resistance level at $1.38 per pound and held the gains.

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Gold, Silver Higher

“Several producers are supposed to be experiencing tightness, but we had one report out of Chile that there are actual problems supplying,” said William O’Neill, director of research for Elders Futures Inc., New York.

“Then, we got rumors that a major New York trading house was looking to take a substantial amount out of the Comex warehouse and refine it into high-grade copper,” he added. “The speculation is that it may be related to a shortage one of the producers is experiencing.”

Copper futures prices settled 6.60 to 7.80 cents higher, with the contract for delivery in April at $1.416 a pound.

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Among the precious metals, gold advanced $2.30 to $2.60, with April on the Comex at $386 an ounce; silver was 5.2 to 6.4 cents higher, with April at $5.821 an ounce.

Gasoline was the surprise leader among the energy futures because demand for the product doesn’t peak until the start of the summer driving season. Monday’s rally also looked past reports that several OPEC members were ignoring production quotas, pushing the cartel’s daily output to 20 million barrels per day.

Crude oil rose 2 to 57 cents, with the May contract at the New York Mercantile Exchange settling at $20.59 a barrel; heating oil was unchanged to 1.85 cents higher, with May at 53.45 cents a gallon, and unleaded gasoline was 0.80 cent to 2.25 cents higher, with May at 67.20 cents a gallon.

Sugar futures were 0.32 to 0.50 cent lower on the New York Coffee, Cocoa and Sugar Exchange, with the May contract at 11.88 cents a pound.

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“The recent strength had as much to do with today’s loss as anything,” said Arthur Stevenson, analyst for Shearson Lehman Hutton Inc. New York.

“There were so many rumors going around about buys by this country or that and a lot of people got nervous and started taking profits in case none of it materializes,” he added.

Ironically, rumors that Mexico bought as much as 280,000 tons in recent days made the rounds just minutes after the market closed.

Live hog futures were the only positive note in the complex at the Chicago Mercantile Exchange.

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“Many pork producers grow their own feed and now is the time they start field preparations for the feed crops,” said Chuck Levitt, analyst for Shearson Lehman Hutton Inc. in Chicago.

Tables, Page 16


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