Copper settled up 0.23% at 469.7 lifted by shrinking supplies and prospects for global economic recovery, though signs of weakness in top consumer China capped gains. Copper's rise on Thursday was restrained by a survey showing China's factory activity expanded at the slowest pace in three months in December, weighed down by shrinking export orders.

Copper's yearly decline was more modest than many expected as an expected surge in new mine production was stymied by processing backlogs. These have limited the amount of refined metal being produced and prices have failed to fall significantly. In a sign of resilience in the United States, the world's largest economy, a gauge of factory activity held near a 2-1/2-year high in December and the number of Americans filing new claims for jobless benefits fell for a second week last week.

Copper stocks in LME-monitored warehouses dropped a further 725 tonnes to 366,485 tonnes on Thursday, the lowest level since January 2013, exchange data showed. On the macroeconomic side, the US initial jobless claims fell to 339,000 in the week ending December 28, 2013, and the 4-week moving average was 357,250, a new high since late October. The December ISM manufacturing index was 57.0, exceeding expectations but still trailing November's figure. Markit manufacturing PMI for the US nudged up from 54.4 to 55.0 in December.

The US stocks and base metals kept falling in the wake of these releases. Technically market is under short covering as market has witnessed drop in open interest by -0.69% to settled at 14042 while prices up 1.1 rupee, now Copper is getting support at 467.4 and below same could see a test of 465.1 level, And resistance is now likely to be seen at 473.2, a move above could see prices testing 476.7.

Trading Ideas:

Copper trading range for the day is 465.1-476.7.

Copper rose lifted by shrinking supplies and prospects for global economic recovery, though signs of weakness in top consumer China capped gains.

Trading volumes are expected to remain light due to the holiday period, reducing liquidity in the market and increasing volatility

Gains were limited as traders also digested a pair of disappointing reports on the Chinese manufacturing sector.