Copper Gains on Speculation U.S. Treasury Plan Will Spur Demand

By Millie Munshi

Sept. 22 (Bloomberg) -- Copper rose to the highest in two weeks on speculation that a $700 billion plan to help U.S. financial companies will revive growth and spur metals demand.

Copper has gained for three straight sessions as leaders in Congress considered Treasury Secretary Henry Paulson's bid to cleanse lenders of toxic assets. Commodities have rallied on the improved economic growth outlook, with the Reuters/Jefferies CRB Index of 19 raw materials gaining as much as 0.7 percent.

``The recently announced industry bailout has changed the commodities landscape,'' Edward Meir, an analyst at MF Global Ltd. in Darien, Connecticut, said today in a research note. Copper's rally ``may have some legs to it.''

Copper futures for December delivery gained 6.6 cents, or 2.1 percent, to $3.2425 a pound at 9:18 a.m. on the New York Mercantile Exchange's Comex division. Earlier, the price jumped as much as 2.3 percent to $3.249, the highest since Sept. 5.

On the London Metal Exchange, copper for delivery in three months added $130, or 1.8 percent, to $7,190 a metric ton ($3.26 a pound). Before today, the price rose 5.8 percent this year.

To contact the reporter on this story: Millie Munshi in New York at mmunshi@bloomberg.net.