Southern Copper (SCCO) Surges 2.6% Amid Copper Price Rally and Earnings Optimism—What’s Fueling the Momentum?

Summary
• Southern Copper (SCCO) surges 2.6% to $134.19, hitting a 52-week high of $134.59
• Q3 earnings beat estimates, with record revenue and margin improvements
• Copper prices climb to $11,146/ton, driven by supply disruptions and AI demand
• Options activity intensifies, with call options on 130–135 strike prices seeing heavy turnover

Today’s sharp rally in Southern Copper reflects a confluence of factors: soaring copper prices, robust earnings, and renewed investor confidence in the metal’s long-term demand. The stock’s 2.6% gain has pushed it closer to its 52-week high, with technical indicators and options data suggesting a potential continuation of the upward trend.

Copper Price Surge and Earnings Outperformance Drive SCCO’s Rally
Southern Copper’s 2.6% intraday gain is directly tied to a record-high copper price of $11,146/ton on the London Metal Exchange, fueled by supply disruptions at major mines and heightened demand for electrification and AI infrastructure. The company’s Q3 earnings report, released earlier this week, further amplified optimism, with revenue rising 15.2% to $3.38 billion and operating cash costs dropping 44.7% year-over-year. Analysts at Jefferies and Wells Fargo have upgraded the stock, citing SCCO’s cost efficiency and strategic projects like Tia Maria, which is now 23% complete. The rally also coincides with a broader materials sector rebound, as Freeport-McMoRan (FCX) surged 2.65% on similar tailwinds.

Materials Sector Gains Momentum as Copper Prices Hit Record Highs
The materials sector is experiencing a synchronized rally, with copper prices surging to multi-decade highs amid supply constraints and AI-driven demand. Freeport-McMoRan (FCX), the sector’s bellwether, has outperformed SCCO in recent sessions, rising 2.65% today. However, SCCO’s lower valuation (27x P/E vs. FCX’s 35x) and stronger cost controls position it as a compelling alternative for investors seeking exposure to the copper supercycle. The sector’s momentum is further supported by geopolitical tailwinds, including U.S. policy shifts to bolster domestic rare earth supply chains and a thaw in U.S.-China trade tensions.

Options and ETFs to Capitalize on SCCO’s Bullish Momentum
• 200-day MA: $100.37 (well below current price)
• RSI: 48.73 (neutral, suggesting potential for further gains)
• MACD: 4.72 (bullish divergence from signal line at 5.30)
• Bollinger Bands: Price at $134.19, near upper band of $142.01

SCCO’s technicals point to a continuation of the bullish trend, with key resistance at $142.01 and support at $130.33. The stock’s short-term bearish pattern contrasts with its long-term bullish trajectory, making it a candidate for a breakout trade. For leveraged exposure, consider the Direxion Materials Bull 3X ETF (MATL), which tracks the sector’s momentum.

Top Options Picks:
• SCCO20251121C130 (Call, $130 strike, Nov 21 expiry):
- IV: 33.22% (moderate)
- Delta: 0.687 (high sensitivity to price moves)
- Theta: -0.1899 (rapid time decay)
- Gamma: 0.0367 (strong sensitivity to gamma)
- Turnover: 6,630 (high liquidity)
- Leverage Ratio: 21.30%
- Payoff at 5% upside ($140.89): $10.89/share
- This call offers a balance of leverage and liquidity, ideal for capitalizing on a potential breakout above $130.

• SCCO20251121C135 (Call, $135 strike, Nov 21 expiry):
- IV: 34.22% (moderate)
- Delta: 0.486 (moderate sensitivity)
- Theta: -0.1817 (high time decay)
- Gamma: 0.0402 (strong gamma)
- Turnover: 7,202 (high liquidity)
- Leverage Ratio: 37.07%
- Payoff at 5% upside ($140.89): $5.89/share
- This option provides higher leverage with a slightly out-of-the-money strike, offering asymmetric upside if SCCO breaks through $135.

Aggressive bulls should consider SCCO20251121C130 into a test of the $130.33 support level, while those seeking higher leverage may target SCCO20251121C135 if the stock consolidates near $134.19.

Backtest Southern Copper Stock Performance
Below is an interactive event-backtest module that visualises how Southern Copper (SCCO.N) has behaved after every ≥ 3 % single-day price jump since 1 Jan 2022.Key take-aways (summary):1. Event frequency • 96 distinct ≥ 3 % up-days were identified over the sample.2. Average performance vs benchmark (close-to-close basis) • Day +1: +0.07 % (benchmark +0.11 %) • Day +5: +0.66 % (benchmark +0.57 %) • Day +10: +0.95 % (benchmark +1.12 %) • Day +20: +2.69 % (benchmark +2.19 %) • Day +30: +3.76 % (benchmark +3.24 %)3. Statistical signal • None of the post-event horizon returns achieved conventional statistical significance; the pattern is thus best viewed as a mild tendency rather than a robust alpha source.4. Win rate • The proportion of positive returns trends from ~50 % on Day +1 to ~58–60 % by Day +30. 5. Practical implication • A simple “buy close on a ≥ 3 % up-day, hold ~20–30 sessions” approach would have delivered a modest edge (~50 bps over the benchmark) but with no statistical confirmation; risk-adjusted returns may not justify isolated deployment.Assumptions & auto-filled parameters:• Price series: closing prices (default where intraday not explicitly required). • Event window: engine default ±30 trading days; user did not specify. • Trading calendar: U.S. equity holidays/ weekends excluded. Feel free to drill into the interactive panel for full distribution charts, cumulative P&L curves, and day-by-day statistics.

SCCO’s Rally Gains Legs—Position for a Breakout or Reversal
Southern Copper’s rally is underpinned by a perfect storm of fundamentals and technicals, with copper prices and earnings momentum aligning to push the stock toward its 52-week high. The materials sector, led by Freeport-McMoRan (FCX +2.65%), is amplifying the move, suggesting a broader supercycle is underway. Investors should monitor SCCO’s ability to hold above $130.33 and break out of its Bollinger Band range, which would validate the long-term bullish case. For now, the SCCO20251121C130 call and MATL ETF offer the most compelling entry points to capitalize on this momentum.