New York: 18:46 || London: 23:46 || Mumbai: 05:16 || Singapore: 07:46

Commodities » Industrial Metals

Industrial metals (copper, aluminium, nickel, etc.) daily review (August 08, 2014)

August 8, 2014, Friday, 06:47 GMT | 01:47 EST | 11:17 IST | 13:47 SGT
Contributed by Angel Broking


Base Metals

Base metals on the LME apart from Zinc traded on a positive note yesterday owing to fall in unemployment claims data from the US.

Nickel prices were supported by production halts this week at the Ramu mine in Papua New Guinea, due to local unrest which highlighted risks to the global supply of the metal. Also, prospects that wider Western sanctions against Russia could soon affect the major producer of the metal acted as a positive factor.

However, a stronger DX along with weak economic data from the Euro Zone restricted sharp gains. In addition, rise in risk aversion in the market sentiments exerted downside pressure on prices.

MCX base metals traded higher in line with trend in the international markets.


Copper

LME Copper prices gained 0.3 percent yesterday owing to decline in unemployment claims data from the US that pushed the average over the past month to an eight-year low, a sign the labor market continues to gain momentum in the second biggest consumer.

However, the European Central Bank signaled that it stands ready to print money and buy bonds if the euro zone slides towards deflation and warned the conflict in Ukraine poses a serious risk to the bloc's economy. Also, weak global market sentiments coupled with strength in the DX exerted downside pressure on prices. The red metal touched an intra-day high of $7018/tonne before closing at $6985/tonne on Thursday.

MCX Copper prices rose by 0.4 percent in line with strength in international markets and closed at Rs.431.7/kg.


Outlook

We expect LME copper prices to trade lower today as investors will remain cautious ahead of Chinese inflation data due tomorrow and geopolitical tensions in Ukraine.

However, sharp fall will be cushioned as China’s export growth unexpectedly accelerated in July thereby suggesting global demand will help the government achieve its 2014 economic-expansion goal of about 7.5 percent.

In the Indian markets, base metals will trade on a negative note taking cues from weakness in international markets.