Investing.com - Copper futures extended strong gains from the prior session on Wednesday to hit the highest level in more than seven weeks as indications of steady demand from China and news of global production cuts boosted prices.
Copper for September delivery on the Comex division of the New York Mercantile Exchange hit an intraday peak of $2.475 a pound, the most since July 21, before trading at $2.446 during morning hours in London, up 1.2 cents, or 0.48%.
A day earlier, copper surged 12.2 cents, or 5.28%, the biggest daily percentage gain in over two years.
Data on Tuesday showed that China’s copper arrivals in August totaled 350,000 metric tons, little changed from a month earlier, indicating that demand for the red metal held up despite recent market turmoil.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Copper is up almost 6% this week after Swiss-based mining giant Glencore (LONDON:GLEN) said Monday that it was suspending operations at two copper mines for 18 months in a bid to lower operating costs.
The Katanga and Mopani mines are located in the Democratic Republic of the Congo and Zambia, respectively, and their suspensions will remove about 400,000 tonnes of copper from the market.
Copper prices have been under heavy selling pressure in recent months as fears of a China-led global economic slowdown spooked traders and rattled sentiment.
Prices of the red metal sank to a six-year low of $2.202 on August 24 as concerns over the health of China's economy and steep declines on Chinese stock markets dampened appetite for the red metal.
The turmoil in markets began when China unexpectedly devalued the yuan on August 11, sparking fears that the economy may be slowing at a faster than expected rate.
Elsewhere in metals trading, gold futures for December delivery inched up 50 cents, or 0.04%, to trade at $1,121.50 a troy ounce amid ongoing uncertainty about whether the Federal Reserve will increase interest rates when it meets on September 16-17.
The timing of a Fed rate hike has been a constant source of debate in the markets in recent months.
Gold fell to a five-and-a-half year low of $1,072.30 on July 24 amid speculation the Fed will raise interest rates in September for the first time since 2006.
Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.
Meanwhile, Asian equity markets rose sharply on Wednesday, tracking strong overnight gains on Wall Street.
Japan's blue-chip Nikkei stock index soared 7.7%, the biggest one-day gain since 2008, while the Shanghai Composite tacked on 2%, one day after posting a late rally to end up 3%.
The upbeat sentiment carried over to European markets, where Germany's DAX, France’s CAC 40 and London's FTSE 100 were all up almost 2% in early trade.
In the U.S., Wall Street pointed to strong gains at the open, with the Dow futures up 180 points.
Global equities rallied amid hopes of more monetary stimulus from policymakers in China and Europe in the coming months.