Investing.com - Copper futures rallied more than 1% on Monday, as investors cheered an upbeat report on China’s manufacturing sector.
On the Comex division of the New York Mercantile Exchange, copper for July delivery rose to a session high of $3.169 a pound, the most since May 29, before trimming gains to last trade at $3.165 during European morning hours, up 1.34%, or 4.2 cents.
Copper ended Friday’s session down 0.67%, or 2.1 cents to settle at $3.123 a pound. Futures were likely to find support at $3.120 a pound, the low from May 30 and resistance at $3.176 a pound, the high from May 29.
Data released over the weekend showed that China’s official manufacturing purchasing managers’ index rose to a five-month high of 50.8 in May, above expectations for 50.6 and up from 50.4 in April.
The Asian nation is the world’s largest copper consumer and manufacturing numbers are used as indicators for future demand growth.
Elsewhere on the Comex, gold for August delivery shed 0.12%, or $1.50, to trade at $1,244.60 a troy ounce, while silver for July delivery eased up 0.2%, or 3.8 cents, to trade at $18.72 an ounce.
Gold extended losses from last week as prices remained below key support levels, indicating bearish chart signals. Prices lost 3.53%, or $45.70 an ounce last week. For May, gold prices dropped 3.9%, the biggest monthly price decline since November.
The precious metal has been under heavy selling pressure recently as investors bet on strong economic growth in the U.S. during the second quarter.
While data released last week showed that the U.S. economy contracted 1% in the first quarter, market analysts expects second quarter growth to snap back with a 3.8% gain, as the economy shakes off the effects of a weather-related slowdown over the winter.
In the week ahead, investors will be looking to Friday’s U.S. nonfarm payrolls report for May for further indications on the strength of the labor market and the need for stimulus from the Federal Reserve.
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