The spot copper price held onto recent gains on Monday losing a fraction on the day to close at $3.28 a pound.
Copper's recent move higher has been driven good manufacturing numbers from China, the US and the UK and surprisingly strong industrial activity in the Eurozone.
iStockAnalyst.com quotes a research note from investment bank JP Morgan underscoring the positive momentum in the base metal market and a more robust precious metal picture:
"The strong rebound in J.P. Morgan's global manufacturing PMI, improving physical demand and our economists' first upgrade of Chinese growth expectations since February make us turn tactically overweight. This is especially important for base metals and copper in particular given China's very large share of global metal demand and thus, we go overweight base metals and copper in addition to our longstanding energy overweight.
We also close our underweight in precious metals given positive momentum, cleaner positions and the impending start to the debt ceiling negotiations. In our commodities portfolio, this leaves us OW energy and base metals, neutral precious metals and UW agriculture, where high prices coupled with better weather conditions compared to last year have led to a large increase in supply expectations."
Copper gained 4.5% in August, a second month of gains, and hit a two-month intra-day high of $3.38 in the middle of last month.
Copper has also rallied more than 8% from the intra-day low of $3.03 hit at the end of July.