SHANGHAI: Copper rose on Monday after Greece and Italy appointed new leaders and seem on track to roll out austerity measures to avert a euro zone and global financial meltdown.
But traders warned the market's positive reaction hinged on how Italy's planned sale of 3.0 billion euros of five-year bonds on Monday was received by the market.
Investors will probably still eye the fragile euro zone with caution as leaders warned they might not be able to leverage the region's bailout fund as much as they wanted to.
FUNDAMENTALS
Three-month copper on the London Metal Exchange rose 1.8 percent to $7,778 a tonne by 0108 GMT, after rising 2.2 percent previously.
The most-active January copper contract on the Shanghai Futures Exchange jumped 3.3 percent to 57,460 yuan ($9,059.66) per tonne, after closing Friday up 1.4 percent.
The Italian Senate approved a new budget law, clearing the way for approval of the package in the lower house on Saturday and the formation of an emergency government to replace that of Prime Minister Silvio Berlusconi.
In Athens, former European Central Bank policymaker Lucas Papademos was sworn in as Greek prime minister after days of political wrangling and tasked with meeting the terms of a bailout plan to avert bankruptcy.
Americans became more hopeful about the US economic outlook in November, pushing consumer sentiment to a five-month high, though they still have a gloomy view of personal finances, a survey released on Friday showed.
Political turmoil in Italy and Greece is complicating efforts to increase the firepower of the euro zone's bailout vehicle to 1 trillion euros, an official at the European Financial Stability Facility said on Friday.
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