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Copper settles

higher

NEW YORK: Comex copper settled sharply higher on Friday due to a switch in sentiment due to more bullish demand according to some brokers, though others put the gains down to short-term speculative play in the nearby months.

A broker said most are bearish about fundamentals and that large speculative play lay behind this week's sharp gains. LME option positions at $2,600 per tonne for May were taken on Monday when they were about $100 out of the money.

"Most people think several large players wanted to make a play on May and June, and that's what changed sentiment. People did not want to be caught short," the broker said.

Today those LME options ended a few dollars in the money, the broker added.

May Comex settled 2.40 cents higher at 123.00 cents a lb, the highest close since early January on a weekly chart.

Rich Hirsch of Deutsche Sharps Pixley said the technical break-out into new territory was supported by fundamentals, with good demand in the U.S. and a growing Far East market.

"Perhaps people have been overconfident in their bearishness, and this blow-out has taken everyone by surprise," Hirsch said. "Most people have overestimated the strength of the supply side. Perception has changed."-Reuter