Investing.com - Copper prices bounced off a five-week low struck in the previous session on Tuesday, amid speculation policymakers in China will have to introduce further stimulus measures to jumpstart the economy amid lackluster growth.
On the Comex division of the New York Mercantile Exchange, copper for July delivery tacked on 1.1 cents, or 0.4%, to trade at $2.731 a pound during European morning hours. Prices held in a range between $2.713 and $2.738.
A day earlier, copper prices slumped to $2.710, a level not seen since April 24, before settling at $2.720, down 0.8 cents, or 0.29%.
Futures were likely to find support at $2.694, the low from April 24, and resistance at $2.784, the high from May 29.
A pair of reports on China's manufacturing sector released Monday failed to ease concerns about a slowdown in the world's second-largest economy, indicating that China needs to act to prevent a further slowdown in the economy.
Since November, the People's Bank of China has introduced a series of stimulus measures, including lowering interest rates three times and cutting the reserve requirement ratios of major banks twice, in order to spur economic activity and boost growth.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Elsewhere, gold futures for August delivery dipped $1.50, or 0.13%, to trade at $1,187.20 a troy ounce, while silver futures for July delivery shed 0.2 cents, or 0.01% to trade at $16.67 an ounce.
In the currency market, the dollar rose to fresh 12-and-a-half year highs against the yen, amid speculation the Federal Reserve was on track to raise interest rates in September. USD/JPY hit highs of 125.06, the most since November 2002 before pulling back to 124.61.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was at 97.20, not far from the five-week highs of 97.88 hit last week.
The greenback has been well-supported in recent sessions amid indications the U.S. economy is gaining momentum after a slowdown in the first quarter, supporting the case for higher interest rates later this year.
Later in the day, the U.S. was to release data on factory orders for April. Market players are also looking ahead to the nonfarm payrolls report due later this week.
Meanwhile, Greece’s creditors said late Monday that there must be “intensive work” in the coming days to reach an agreement on economic reforms needed to unlock further financial aid.
The debt-strapped nation is due to make a €305 million payment to the International Monetary Fund on Friday but warned last month that it will be unable to make the repayment if a cash-for-reforms deal is not reached by then.