Similar to previous "risk-on" rallies in recent days, copper led the charge with a 6-percent gain -- its third rally of 6 percent or more in the past five trading days. Other base metals jumped in step with the red metal. Zinc, nickel and lead all climbed more than 5 percent in the session.
Just weeks removed from its largest monthly and quarterly declines that pressured prices in London and New York to 2011 lows, copper prices are once again on the rise, with strong technical momentum forcing many market bears to cover during the October surge.
"The volatility has been enhanced on both sides. We failed to break $3 on the downside, and it has been just a parabolic move up from there," said Adam Klopfenstein, Senior Market Strategist.
"The volatility and ranges have increased. Optimism and pessimism can shift from day to day, or week to week. Just a few weeks ago everyone thought we were heading toward another recession ... now it's the farthest thing from the mind."
For the week, prices of copper are up more than 14 percent -- in line for its biggest weekly gain in more than 30 years. It's a move that should begin to run out of steam, but analysts said there maybe some upside left due to ongoing supply problems at two major mines owned by Freeport McMoRan Copper & Gold Inc, which threaten to tighten an already-constrained supply base.
"If this (rally) were just related to the European debt deal, then I would say it would probably be a little bit more short-lived and due for some profit-taking, but with Freeport's force majeure, it may have some more life in it than some of the other commodities that are rallying right now," said Catherine Virga, senior base metals analyst with CPM Group in New York.
London Metal Exchange (LME) benchmark copper peaked at $8,178.75 per tonne, its priciest level since Sept. 22, before closing the day bid at $8,145, from Wednesday's close of $7,680.
In New York, the key December COMEX contract shot up by 20.20 cents or 5.8 percent to settle at $3.6920, after moving between $3.4980 and $3.7135, a high dating back to Sept. 22.
Volumes, at a little more than 65,000 lots in New York, remained largely in line with their 30-day average, according to preliminary Thomson Reuters data.
Risk sentiment improved after EU leaders and banks reached a deal on a 50 percent write-down for private bondholders on their Greek debt, and agreed to recapitalise European banks and scale up the euro zone's 440 billion euro ($600 billion) bailout fund.
"Markets are feeling more confident after what seems to be progress on the European bailout and the positive US numbers as well. Markets have been waiting for some clarity over Europe for ages," said Societe Generale analyst David Wilson.
Freeport declared force majeure on some concentrate sales from its strike-hit Grasberg mine in Indonesia on Wednesday.
At Freeport's Peruvian copper mine Cerro Verde, the union said late Wednesday it had rejected a request to go into labour arbitration to end a month-old strike.
CHINESE GROWTH
Hopes that top metals consumer China will ease its monetary policy and boost economic growth and metals demand also helped industrial metals.
Many market watchers expect the People's Bank of China (PBOC) will begin to loosen its tight liquidity policy by year-end as China's economic growth slows, while hopes run high that inflation has peaked.
Confirming improving demand for copper, inventories at warehouses monitored by the LME fell for the fifth consecutive day, by 2,750 tonnes to 434,675 tonnes, latest data showed.
Data from the United States offered additional upside support. US economic growth increased at its fastest rate in a year in the third quarter, creating momentum that could carry into the final three months of the year.