New York: Copper surged 9 per cent last week for its biggest weekly gain since February, as a soft dollar and firm economic data boosted most commodities last week, although evidence of a few fragile European banks worried some investors, limiting gains.
Worries about crops in the drought-hit Black Sea region helped push wheat up 1.5 per cent last week. The grain is up 28 per cent in July so far, in line for the biggest monthly rise since 1996 as the market frets about supplies from Russia, the No 1 wheat exporter.
Copper, one of the world's most crucial industrial metals and key to the construction and power generation businesses, gained 0.7 per cent on Friday and nearly 9 per cent on the week after ending up a fifth straight session.
It was the metal's biggest weekly gain since February 21, helped by the dollar's slide against the euro, encouraging economic data on both sides of the Atlantic and a spike in buying from top copper consumer China.
But trade in a broad number of commodities were muted during Friday's earlier session as investors awaited results of European bank stress tests.
EU regulators were checking to see if 91 of the bloc's top banks had enough capital to withstand shocks worse than the collapse of US Lehman Brothers in September 2008, which triggered a near meltdown of global markets. The results showed seven of the 91 European banks failing the tests. Overall capital shortfall was 3.5 billion euros,
"We are not seeing a huge reaction because the seven banks that failed were not really that far out of line with market expectations," Peter Buchanan, commodities analyst and senior economist at CIBC in Toronto, said.
"It's not necessarily that the results were positive, but it's just one more item of uncertainty out of the way at this point," he said.
Edward Meir, energy and metals analyst in New York for brokerage MF Global, had a similar view. "We think a number of markets will breathe somewhat easier after the Europeans stress test results are successfully behind us."
