Investing.com - Copper futures extended gains from the prior session to hit a one-week high on Thursday, as a sharp rebound on Wall Street overnight helped soothe investors' tattered nerves.
Copper for September delivery on the Comex division of the New York Mercantile Exchange hit an intraday peak of $2.349 a pound, the strongest level since August 28, before trading at $2.347 during morning hours in London, up 1.7 cents, or 0.74%.
A day earlier, prices of the red metal jumped 2.8 cents, or 1.22%. Wednesday's gains came after U.S. stocks surged, with the NASDAQ moving out of correction territory, as investors kept an eye on oil prices and calmer global markets.
Volatility eased on Thursday as China’s stock markets remained closed for the World War Two Victory Day parade.
Copper prices have been under heavy selling pressure in recent weeks 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.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Elsewhere, gold futures for December delivery dipped 80 cents, or 0.07%, to trade at $1,132.80 a troy ounce, as investors looked ahead to Friday’s nonfarm payrolls report, which could help to provide clarity on the likelihood of a near-term interest rate hike.
The consensus forecast is that the data will show jobs growth of 220,000 last month, following an increase of 215,000 in July, while the unemployment rate is forecast to decline to 5.2% from 5.3%.
A strong jobs report was likely to add to indications that the Federal Reserve will raise rates in September, while a weak number could push back expectations to December.
The timing of a Fed rate hike has been a constant source of debate in the markets in recent months.
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.