Gold reclaims $1,300, copper at 2-month high

NEW YORK (August 8)  Copper and gold futures jumped on Thursday, extending gains made after China reported stronger-than-expected trade figures for July.

September copper futures  +3.03%  rose 9 cents, or 2.7%, to $3.26 a pound in recent action, the strongest level since early June, according to FactSet.

Gold for December delivery rose $22.20, or 1.7%, to $1,307.50 an ounce on the New York Mercantile Exchange.

“China is the 800-pound gorilla in the room from a commodities standpoint,” said Jason Rotman, president of Lido Isle Advisors.

The moves came after July trade figures from China, the world’s largest copper consumer, indicated growing appetite for the industrial metal. Copper imports rose 12% from a year ago, and increased 8.1% from June. 

China also said its overall exports rose 5.1% in July, compared to June’s 3.1% fall. Analysts polled Dow Jones Newswires had expected a 2.8% increase in exports. Imports leapt 10.9% last month, after June’s drop of 0.7%. Analysts were looking for a 1.3% rise for imports.

Copper could rise to its highs from May of $3.40 a pound in the next quarter if the market grows more positive on the Chinese economy, said Rotman. He attributed about 80% of copper’s gain on Thursday to the Chinese data, with some help from upside surprises in euro-zone reports.

The gain in gold futures was equally attributable to the China trade numbers and the weakness in the U.S. dollar, Rotman added.

In the U.S., weekly jobless claims for the week ended August 3 rose 5,000 to 333,000, a smaller gain than expected by economists.

Gold futures on Wednesday edged up $2.80, or 0.2%, on the New York Mercantile Exchange, the precious metal’s first advance after six consecutive declines.

Gold has been under pressure as the U.S. Federal Reserve appears set to soon reduce monetary stimulus, or quantitative easing, with policy makers citing improvement in the economy as reason for the move. Asset purchases by the central bank have been seen as a source of support for gold prices in recent years.