Copper on MCX settled up 1.21% at 405.05 as LME prices bounced back above $6,000 a tonne as a dispute affecting production at the world's second-biggest copper mine worsened. U. S. mining giant Freeport-McMoRan Inc said on Monday that it could take the Indonesian government to arbitration and seek damages over a contractual dispute that has halted operations at its huge Grasberg mine. Further tightening supplies is a strike at Chile's Escondida copper mine, the world's biggest, which has extended into a second week. Both Grasberg and Escondida declared force majeure last week. Representatives of Escondida, controlled by BHP Billiton, plan to attend talks with striking workers on Monday as long as the union does not interfere with a shift change for non-union employees. Reinforcing the idea of a pick-up in Chinese demand was new loans data; banks extended 2.03 trillion yuan ($295.74 billion) in net new yuan loans in January, the second- highest monthly tally on record. A reading on Philadelphia-area manufacturing activity unexpectedly showed a substantial acceleration in the pace of growth in the month of February, the Federal Reserve Bank of Philadelphia revealed in a report. The Philly Fed said its index for current manufacturing activity in the region soared to 43.3 in February from 23.6 in January, with a positive reading indicating growth. The focus will be on fixed-asset investment, industrial production, surveys of purchasing managers in manufacturing and property market indicators in China. Technically market is under fresh buying as market has witnessed gain in open interest by 10.42% to settled at 12930 while prices up 4.85 rupees, now Copper is getting support at 401.4 and below same could see a test of 397.7 level, And resistance is now likely to be seen at 408.1, a move above could see prices testing 411.1.

Trading Ideas

# Copper trading range for the day is 397.7-411.1.

# Copper gained buoyed by supply worries after the copper mine in Indonesia said it could not deliver promised shipments due to export permit issues.

# The copper market is likely to move into deficit in 2017 for the first time in six years, due to a combination of tightening supply and recovering demand.

# Escondida declared force majeure, but industry sources said that smelters and fabricators were still amply supplied with metal.