Copper rose on Monday as a weaker dollar and record bullion prices boosted sentiment and lead was up 4.6 per cent at one point as funds piled in, analysts said.
Lead for delivery in three months on the London Metal Exchange hit an intraday high of $2,750 after breaking a technical resistance level prompting fund buying. It closed at $2,735 a tonne, up 4 per cent since Friday's close of $2,630.
Copper ended at $7,400 a tonne, up 1.4 per cent, compared with $7,300 on Friday. Prices have risen by over 10 per cent over the last two weeks.
The dollar hit seven-week lows against the euro and yen on growing speculation the US Federal Reserve would slash interest rates by half a percentage point before the month ends.
On the back of a soft dollar, gold hit a record high of $914 an ounce.
Traders said commodity index buying had supported the base metals complex metals since last Tuesday.
Economic slowdown in the United States and the knock-on effect on the global economy pushed copper prices to nine-month lows last in December. That fear is still there.
Talk of tighter copper supplies if China introduces a 17 per cent value added tax on scrap recyclers, who are currently exempted could also help prices. The rumoured tax has already prompted some importers to cut scrap shipments.
However, aluminium prices are expected to be firmly underpinned by rising prices of energy, a key component in the production process.
Aluminium closed at $2,548 a tonne from $2,514 on Friday and steel making raw material nickel was up at $29,300 a tonne from $28,650.
Zinc closed at $2,396 from $2,390 on Friday and tin was last quoted at $16,425/16,450 from $16,300/16,305.
COMEX
US gold futures finished above $900 an ounce for the first time on Monday, fuelled by a combination of strong fund buying amid a dollar slide, short covering and speculation of further rate cuts.
However, gold contracts trimmed gains to finish off their record high of $917.90 set earlier in the sessions as a recovery of the dollar's strength prompted profit taking.
Meanwhile, a Citigroup metals analyst said that gold prices will test a record $1,000 an ounce this year, boosted by growing investment interest, safe-haven demand and strong market fundamentals.
The most-active gold contract for February delivery at the COMEX division of the New York Mercantile Exchange settled up $5.70 to $903.40 an ounce. It hit a record high of $917.90 and bottomed at $893.10.
The dollar dropped to the lowest level in seven weeks against the euro and yen on Monday as fears that weak US corporate earnings will push the economy closer to a recession, requiring the Federal Reserve to cut interest rates.
Interest rate futures are reflecting a 50/50 chance that the Fed could reduce its interest rate by three-quarters of a point between now and the Jan 29-30 meeting.
Gold is often viewed as an alternative to holding the dollar, and thus the value of gold usually rises when the US dollar falls. A weaker dollar also boosts gold for investors holding other currencies, since the precious metal is denominated by the greenback.
Gold's appeal as a safe-haven investment has increased due to worries of further write-downs among major financial institutions and credit market meltdown in the United States, the world's biggest economy.
In just three weeks, the February contract has jumped nearly $120 to Monday's peak of $915.90 from its bottom of $799.50 on December 21.
At 2:15 pm, spot gold was quoted at $902.10/902.80 an ounce, up from Friday's New York close of $895.70/896.50.
London bullion dealers fixed the afternoon spot reference price at $902.00.
COMEX March silver finished up 5.5 cents at $16.425 an ounce, trading from $16.250 to a contract high of $16.715.
Spot silver was at $16.31/16.36, up from $16.19/16.24 late Friday. London silver was fixed at $16.50.
April platinum jumped $14.60 to end at $1,584.00, after setting a record high of $1,597.40. Spot platinum was quoted at $1,572/$1,577.
March palladium closed up $6.15 or 1.6 per cent at $387.45 an ounce and spot palladium fetched $379/$384.
NYMEX
US crude oil futures rebounded on Monday as the weak dollar, strong commodities, revived Middle East tensions and threats to Nigeria's oil helped lift the petroleum complex.
On the New York Mercantile Exchange, February crude settled up $1.51, or 1.63 per cent, at $94.20 a barrel, trading from $92.41 to $94.43.
Resistance was at $94.50, just below the 20-day moving average oft $94.47.
NYMEX crude reached a record $100.09 on January 3, but on Friday ended down $5.01, or 5.12 per cent, for the week.
In London on Monday, February Brent crude was up $1.93, or 2.12 per cent, at $93 a barrel, trading from $91.01 to $93.03. The February contract expires on Wednesday.
The dollar dropped to a record low versus the Swiss franc and seven-week lows against the euro and yen on Monday as concern that weak US corporate earnings will prompt more interest rate cuts weighed on the currency.
Gold and copper were higher on the weak dollar on Monday.
