Copper yesterday settled up 2.59% at 417.15 rose from a low last week, helped by a weaker dollar, but concerns remained about the outlook for demand after data showed growth in China's manufacturing sector had contracted. The dollar fell versus the euro after data showed euro zone manufacturing activity stabilised, but was expected to recover quickly on prospects that the US Federal Reserve will wind down its monetary stimulus programme. A weaker dollar makes dollar-priced metal cheaper for European and other non-US investors. Copper fell by 7.6 percent in June, its biggest monthly drop since May 2012, on worries about growth prospects in China and expectations of a roll-back of stimulus measures from the US Federal Reserve. It hit a near three-year low of $6,602 last week. Worries over the tapering of US monetary stimulus were reinforced earlier by data showing US manufacturing rose in June from a contraction the precious month, while construction spending hit its highest in nearly four years in May. For China, however, figures indicated tepid second-quarter growth in the world's top metals consumer. China's official PMI slipped to 50.1 in June from 50.8 in May. While the latest report by the CFTC showed hedge funds and money managers had boosted short positions in Comex copper by 3,581 contracts to 32,599, the most since early April. Meanwhile The LME said it had launched a 3-month consultation on proposed changes to metals warehousing rules, aimed at reducing long queues that end-users face in getting material. Technically market is getting support at 407.8 and below same could see a test of 398.45 level, And resistance is now likely to be seen at
423, a move above could see prices testing 428.85.

Trading Ideas:

Copper trading range for the day is 398.5-428.9.

Copper gains despite the release of mixed Chinese manufacturing data and amid expectations for Fed to scale back its stimulus program before the year end.

The metal was also boosted by a rise in the euro against the dollar after data showed euro zone manufacturing activity had stabilised.

Refined Copper China's refined copper apparent consumption in May was 784,800 mt, up 14.8% YoY and 10.36% MoM.