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Commodities Industrial Metals

Industrial metals (copper, aluminium, nickel, etc.) daily review (August 05, 2014)

August 5, 2014, Tuesday, 07:45 GMT | 02:45 EST | 12:15 IST | 14:45 SGT
Contributed by Angel Broking


Base Metals

Base metals on the LME traded largely traded on a positive note as investors expected the U.S. would not cut its interest rates soon as job growth slowed a bit in July and the unemployment rate unexpectedly rose, pointing to slack in the labor market, which could give the FOMC room to keep interest rates low for a while.

Further, German new-car sales rose strongly in July as buyers flocked to up market brands, the latest indication that the years-long malaise of the European car industry may have come to an end acted as a positive factor.

In the Indian markets, all the base metals traded higher taking cues from strength in international markets.


Copper

LME Copper prices gained 0.9 percent yesterday after weak U.S. employment data soothed concerns that the Federal Reserve would soon begin to draw back liquidity that has cushioned demand for metals.

However, concerns of expanding global supplies after Freeport resumes copper concentrate exports on Wednesday kept the investors cautious and capped sharp gains. The red metal touched a intra-day high of $7145/tonne before closing at $7141/tonne in the last session.

MCX Copper prices gained 0.8 percent and closed at Rs.438.9/kg on Monday.


Outlook

We expect LME copper prices to trade on a positive note today on the back of estimates of positive retail sales data from the Euro Zone and factory orders from the US in the evening session.

However, concerns of supply glut will continue to exert downside pressure on prices.

MCX Copper prices will trade on a positive note today taking cues from strength in international markets.