LONDON: Copper rose on Monday, leading broad-based gains across the base metals as optimism over the outlook for global growth and supply concerns over some metals helped the complex recover some of the previous session’s losses.

Copper prices bounced back nearly 1 per cent after a half-percent drop on Friday, while tin climbed to another three-month high at $20,675 a tonne.

“There is general macro optimism, with some good data suggesting that global growth remains on track,” Societe Generale analyst Robin Bhar said. “We have China data showing stability, US data has been encouraging, so has Europe.” “Copper and zinc, the two most supply-constrained metals, are still being underpinned by supply fears.” Barclays said in a note that the recent copper price rally was a response to the distribution of global inventories, with tightness seen in key markets.

It has raised its 2018 forecast for the LME average cash price of copper to $6,619 a tonne, and said rallies to as high as $7,700 a tonne are “both possible and likely” if certain conditions are met.

London Metal Exchange copper was up 0.7 per cent at $7,090 a tonne in official midday trading, reversing losses from the previous session. Prices last week edged down to $7,027, with the $7,000 level as yet unbroken this year.

China’s better-than-expected economic growth in the fourth quarter of last year was supported by continued strength in the services industry and an expanding agricultural sector, official data published on Friday showed.

LME copper may break support at $7,036 per tonne and fall more to the next support at $7,005, Reuters technical analyst Wang Tao said, citing its wave pattern and a Fibonacci ratio analysis.

LME tin was 0.3 per cent higher in official trading at $20,660 a tonne. One entity holds more than 90 per cent of tin cash contracts and warrants on the LME system. The premium of cash tin over the three-month contract jumped to $90 a tonne on Friday, a two-month high, indicating concerns over market tightness.

LME zinc was at $3,413 a tonne in official rings, 0.1 per cent lower and edging further from the 10-year peak of $3,444 seen on Friday. Lead, which hit a seven-year high at $2,630.50 a tonne last week, was up 0.9 per cent at $2,605.

Stocks of zinc held in LME-registered warehouses declined another 25 tonnes to 179,950 tonnes, their lowest in nearly a decade.

Reuters