By Leia Michele Toovey- Exclusive to Copper Investing News

Monday Oct 13 2008 is a day that will go down in history. This day, which was also Canadian Thanksgiving, and Columbus Day in the US, was the first day in a long time that the markets gained significant upward momentum. Oct 13 was a record breaking day, but this time the record broken was a good one. The Dow closed the day up 936 points, retracing a great deal of last week’s losses, marking the biggest upswing that the Dow has every taken. Perhaps the second Monday of October 2008 will go down in history as a pinnacle moment, the day that the global economy started to turn around.

At the high, copper was up around 14 per cent, from Friday’s low. Copper sold off sharply last week with US equities on worries about problems in the global financial system hurting the economy. In India, on the MCX, copper rose over 3 per cent after a slide of more than 15 per cent last week. On The Comex division of the New York Mercantile Exchange, copper futures snapped back from last week’s sell-off as global stock bourses stabilized. Most-active December copper rose 16.80 cents to settle at $2.3125 per pound. In London the markets were closed by the time positive market sentiment caused a rally in North American markets.

Over in London, copper futures bounced 4 per cent in early Asian trade on Monday, but fell prior to closing. Copper futures early Tuesday trading value will give a better idea of how LME values are responding.

A few conditions came into alignment to extend positive market sentiment to copper. The first was a rise in crude oil. Oil has dropped from record prices hit this July, but on Monday sweet crude was up 4 per cent. Also contributing was the greenback’s downswing. The dollar index was 1.542 points lower at 81.455, a weaker greenback tends to help metals such as copper, by making them cheaper in foreign currencies. The pick-up today can also be contributed to a `relief rally,’ that extended through equity markets and contributed to the better tone across financial markets. Investors are considerably more optimistic about the state of the global economy with the news that international banks and leaders will work together to combat the global economic crisis.

The potential for supply disruption also lent a hand. After hours on Friday, Chile’s Escondida, the world’s biggest copper mine, announced it would be unable to meet its contract obligations for some copper concentrates after it was forced to shut down a mill used to pulverize rock.

Company News

Codelco, the world’s largest copper producer announced that it will reduce the premium they charge to European buyers. The fee is added on top of the price of copper for immediate delivery and covers the cost of shipping the metal from Chile to Rotterdam. The price will be reduced by 30 per cent, making the surcharge $80 a tonne down from the $115 it was this year. Analysts were certain that a reduction would be issued to struggling European buyers, but they had estimated that the new fee would be $98 per tonne. Demand from Europe has dwindled this year, primarily due to a flat lining construction industry. The year 2008 did start of well for this region, but when July hit, European demand suddenly plummeted. Stockpiles of copper at European warehouses monitored by the LME have risen 33 per cent this year. Codelco will announce its 2009 surcharges for Asian nations later this year.

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