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Commodities Industrial Metals

Industrial metals (copper, aluminium, nickel, etc.) daily review (August 21, 2014)

August 21, 2014, Thursday, 05:49 GMT | 00:49 EST | 09:19 IST | 11:49 SGT
Contributed by Angel Broking


Base Metals

The base metals pack traded sharply on a positive note in yesterday’s trade on account of optimistic building permits and housing starts data from the US economy on Tuesday indicating economic growth in world’s largest economy. Further, upbeat market sentiments supported an upside in the prices. Favorable industrial orders expectations from the UK continued with positive movement in the base metal prices

However, sharp upside in the prices was capped due to strength in the DX after US Federal Reserve stated of ending aggressive cutting of stimulus measures sooner than estimated in its minutes yesterday.


Copper

LME Copper prices rose sharply by more than 2 percent in yesterday’s trade due to rise in US housing starts data to eight month high level. Further, building of stocks by the Chinese economy after taking advantage of lower prices supported an upside in the prices. Additionally, upbeat market sentiments and optimistic economic data from UK continued with positive movement in the prices.

However, sharp upside in the prices was capped due to strength in the DX in yesterday’s trading session.

On the MCX, red metal prices jumped around 2.4 percent and closed at Rs.425.1/kg after touching an intra-day high of Rs./kg on Wednesday.


Outlook

From the intra-day perspective, we expect copper prices to trade on a mixed note today on the back of decline in Chinese manufacturing data will act as a negative factor. Further, expectations of weak manufacturing data from Euro Zone and strings of unfavorable economic data from US in the evening session will exert downside pressure in the prices. Additionally, weak market sentiments and strength in the DX will continue with downside movement in the prices.

However, sharp downside in the prices will be restricted due to building up of stocks for the copper by Chinese economy.

In the Indian markets, downside in the prices will persists due to appreciation in the Indian Rupee.