MUMBAI, Aug 3 (Reuters) - India copper futures extended gains on Monday afternoon, as positive economic data bolstered hopes of an economic recovery and demand for industrial metals, sending the dollar lower, analysts said.
The most-traded copper contract MCCQ9 was 2.70 percent higher at 284.90 rupees per kg at 3:33 p.m., after gaining 10.2 percent in July.
"We expect copper to trade above 286.5 rupees. Copper may extend its rally further on good numbers from China," said Kapil Gandhi of STCI Commodities.
Brokerage CLSA's China Purchasing Manager's index rose to a one-year high of 52.8 in July, confirming official PMI data over the weekend that indicated an expansion in manufacturing.
U.S. gross domestic product numbers on Friday showed the world's largest economy shrank by less than expected in the second quarter. [ID:nPEK360544] [ID:nN30365410] The dollar fell broadly as stronger equities and oil prices boosted appetite for riskier assets. "Prices are running ahead of fundamentals and the rally seems to be overstretched, raising the probability of a correction," said Tejas Seth, a senior research analyst with SMC Global. "Copper may trade in the range of 277-287 (rupees) on Monday." Meanwhile, copper stocks in the warehouses monitored by the London Metal Exchange rose 1,250 tonnes to 282,125 tonnes on Monday. In other base metals, zinc for August delivery MZIQ9 was 3.18 percent higher at 86.05 rupees per kg, while lead for August delivery MLDQ9 was 2.07 percent higher at 91.25 rupees per kg at 3:33 p.m..
http://in.reuters.com/article/domesticNews/idINBOM49425620090803
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