Copper overcame earlier selling pressures to close higher Friday, as the U.S. dollar slipped against the euro and risk appetite returned after surprisingly strong housing data in the United States underscored recovery optimism.
Copper for July delivery on the New York Mercantile Exchange's Comex division settled up 2.40 cents (U.S.) at $3.5305 a pound, near the upper end of its $3.4780 to $3.5415 session range.
On the London Metal Exchange, benchmark copper for three month delivery ended at $7,745 a tonne from $7,692 on Thursday.
Earlier this month, the metal used in power and construction touched a 20-month peak at $8,043.75 in London and nearly $3.70 a pound in New York.
Industrial metals bulls cheered U.S. data showing new home sales surged 26.9 per cent in March, the largest advance since April, 1963, and further evidence of a recovery in the world's largest economy.
"You're seeing some resiliency in the housing numbers," said Adam Klopfenstein, senior market strategist at MF Global Ltd's Lind-Waldock division in Chicago, noting that the figures were likely padded by a home buyer tax credit that is set to expire at the end of the month.
"Going forward, the real caveat to the housing market is how is it going to perform when that stimulus is taken away? But for today, the number still show that there is demand for housing and I think that's what is supporting copper," he said.
Copper found additional support from the currency markets, where the euro rebounded from one-year lows against the dollar after Greece requested emergency financial aid, but concerns about how the aid package will be implemented continued to linger.
Holding back momentum, however, is a fear that China, the world's top consumer of base metals, may be oversupplied with copper after imports of the metal in March jumped more than 50 per cent to 337,125 tonnes.
"We still expect Chinese base metal imports to be significantly lower in 2010 with growing domestic demand fed by off-market stocks of metal," Royal Bank of Scotland said in a research report.
Often a demand indicator, copper stocks rose 25 tonnes to 507,150 tonnes, but were down from peaks of 555,075 hit on Feb. 17 that had previously not been seen since October, 2003.
Aluminum was last bid at $2,332 against $2,320, having earlier touched $2,290, its lowest since end-March.
LME stocks for the metal, used in transport and packaging, slipped 5,900 tonnes to 4.57 million tonnes, remaining near record levels. A large portion of those aluminum stocks are tied up in finance deals, to release cash for producers and to earn banks higher returns than they would get in money markets.
Nickel ended at $27,000 from $27,095 and battery material lead at $2,300 from $2,310.
Base metals traders have been focusing on dominant positions within the smaller LME metal markets, especially nickel.
Analysts say a dominant position of all short positions in nickel due this month, may be behind nickel's gains of around 7 per cent this month and is likely to lend further support to prices in the coming days.
"Nickel continues to bob around in a manner that underlines the uneasy feeling that we are about to experience a shift of seismic proportion very soon," RBC Capital Markets said in a note.
Zinc ended at $2,405 a tonne from $2,418 and tin at $19,000 from $18,950.