Base metals close higher on the LME COPPER prices have charged upward amid bargain-buying and as upbeat economic data from the US and UK led market participants to abandon short positions. However, a high reading for Spanish unemployment highlighted the poor demand outlook from the euro-zone region. At the close of open-outcry trading on Thursday, London Metal Exchange (LME) three-month copper was 2.1 per cent up on the day at $US7,180 a metric ton, with all metals closing higher. This was the second day of considerably higher prices after the metal bounced in Wednesday's session following a run of heavy selling. The recovery has been led by bargain-buying at the lower prices after the metal fell around nine per cent in the space of 10 days, temporarily pushing it into a bear market. Wednesday's recovery lasted into Thursday's session after data showed the number of Americans applying for jobless benefits fell to 339,000 last week, the second-lowest level since January 2008, according to the Labour Department. Copper is widely used in consumer goods, housing and construction. As such, demand for the metal increases as general economic conditions pick up, making it a barometer for the wider health of the economy and of risk sentiment in markets. Figures showing the UK economy expanded by 0.3 per cent in the first three months of 2013, beating expectations and avoiding a recession, added to the factors propping up copper, as did a stronger euro versus the US dollar. This makes the dollar-denominated LME metals more appealing to buyers holding Europe's common currency. This combination of positive factors led market participants to cover their short positions. Some analysts said that book-squaring ahead of a public holiday also was adding to the upside pressure for copper. Despite copper's recovery, there remained a degree of caution in the market, as prices remain some 14 per cent lower from where they were in February. Standard Bank analyst Leon Westgate highlighted more downbeat data, noting in particular Spanish unemployment. This rose more than anticipated, coming in at 27.2 per cent in the first quarter, second only to Greece in the euro zone and "confirming just how long the road to recovery looks to be for many of the euro-zone economies," according to Westgate. Earlier in the session, ABN Amro joined a list of banks revising forecasts, trimming its expectation for average copper prices in 2013 by six per cent to $US8,450/ton. The bank lowered both its 2014 and 2015 average-price forecasts by three per cent to $US8,550/ton and $US8,700/ton, respectively. It also slashed its three-month forecast by nine per cent in the wake of copper's recent price activity, dropping the expected copper price at the end of the next three months to $US8,375/ton. Although the revisions point to a lowering of expectations, the bank nevertheless expects copper to move significantly higher from where it now stands. 3 Months Metal Bid-Ask Change from Wednesday PM kerb Aluminum Alloy 1835.0-1845.0 Up 20 Aluminum Alloy-NASAAC 1800.0-1810.0 No change