20000218Comex March copper rises on trade, spec buying

NEW YORK: Comex copper futures firmed on Wednesday as trade and speculator buying lifted prices from early lows, dealers and analysts said.

"Trade was in there doing most of the volume," said a floor source. "There's only a 95-point trading range, so not much is happening," he added.

Active March climbed 0.10 cent to stand at 82.80 cents a lb, trading between 82.00 and 83.10 cents. Spot February gained 0.15 cent at 82.50 cents a lb and May rose 0.05 cent to 83.80 cents a lb.

"The interest-rate concern is underlying a number of markets, including the base metals complex," Merrill Lynch analyst William O'Neill said. "But I think in the low 80's that's pretty much discounted."

Active March copper touched the key support level of 82.00 cents near midday, but rallied on local buying interest.

O'Neill noted that copper had been underpinned by recent fund selling, both in London and New York, and he saw the red metal as rangebound in recent levels.

"I would look for prices to stabilise under here," added O'Neill. "There's a solid long-term demand base that the copper market is dealing with."

Analysts said that Comex copper was buoyed by the stronger than expected data on housing starts released early Wednesday by the U.S. government.

Housing starts rose 1.5 percent to 1.775 million units for January -- above economists' forecasts of 1.65 million units.

"That's very encouraging to the long term outlook for copper," O'Neill said.

Refco commodities analyst Dan Horn pegged near-term support in March copper at 81.25 cents and resistance at 86 and then 88 cents.

On the London Metal Exchange, three-months copper slipped further, closing $11 lower at $1,833 a tonne, as funds pared their long positions, traders said.

It broke weak support at $1,830 a tonne but managed to hold above the next key level of $1,820. Traders noted that copper's early slide was halted by some Far Eastern buying which came in under the market.

LME copper stocks were down 1,275 tonnes to 798,200 tonnes on Wednesday while Comex stocks were off 22 short tons at 94,978 tons on Tuesday.

Estimated final volume for Comex copper on Wednesday reached 12,000 contracts, compared to official volumes on Tuesday of 12,258 contracts.,-Reuters