Industrial metals (copper, aluminium, nickel, etc.) daily review (January 22, 2014)
January 22, 2014, Wednesday, 06:13 GMT | 02:13 EST | 11:43 IST | 14:13 SGT
Base metals on the LME traded on a positive note yesterday on the back of rise in money supply in the biggest consumer, China. Also, decline in inventories of all base metals coupled with weakness in the DX supported gains. However, mixed global market sentiments capped sharp gains.
In the Indian markets, base metals traded on a positive note owing to Rupee depreciation.
LME Copper traded higher by 0.4 percent yesterday taking cues from drop in money market rates in China, thereby boosting demand for the metal. Also, weakness in the DX coupled with a more than 1 percent decline in inventories acted as positive factors. However, mixed economic data from Euro Zone along with mixed market sentiments capped sharp gains. Further, unfavorable industrial data from UK acted as a negative factor. The red metal touched an intra-day high of $7349.25/tonne and closed at $7345/tonne on Tuesday.
MCX Copper prices jumped by 1.1 percent yesterday on account of Rupee depreciation thereby touching an intra-day high of Rs.462/kg and closed at Rs.461.3/kg on Tuesday.
We expect base metals to trade on a mixed note today on account of weakness in the DX along with easing liquidity in China ahead of Lunar year holiday will act as a positive factor.
While on the other hand, unfavorable economic data from the Euro Zone and UK that came yesterday along with mixed market sentiments will act as negative factors. Also, further QE taper concerns continue to exert downside pressure on base metal prices.
In the Indian markets, Rupee depreciation will support an upside in the prices.