Industrial metals (copper, aluminium, nickel, etc.) daily review (January 23, 2014)
January 23, 2014, Thursday, 07:15 GMT | 02:15 EST | 11:45 IST | 14:15 SGT
Base metals on the LME traded on a negative note yesterday on the back of strength in the DX. Also, weak market sentiments in the later part of the trade coupled with profit booking seen during the trade exerted downside pressure on the prices. However, decline in inventories of all base metals restricted sharp negative movement.
In the Indian markets, base metals traded on a negative note owing to Rupee appreciation.
LME Copper traded lower by 0.6 percent yesterday taking cues from profit booking seen during the trade. Also, strength in the DX coupled with weak market sentiments in the later part of the trade acted as negative factor. Further, decline in inventories by 0.7 percent to 328,375 tonnes could not provide respite to the prices. The red metal touched an intra-day low of $7283.25/tonne and closed at $7298/tonne on Wednesday.
MCX Copper prices plunged by 0.7 percent yesterday on account of Rupee appreciation thereby touching an intra-day low of Rs.462/kg and closed at Rs.456.7/kg on Wednesday.
We expect base metals to trade on a negative note today on the back of unfavorable manufacturing data from the biggest consumer, China. Also, strength in the DX along with weak market sentiments will act as negative factors. Further, QE taper concerns will continue to exert downside pressure on base metal prices. However, sharp downside will be cushioned on the back of expectations of favorable manufacturing data from the Euro Zone and US in the evening session. Additionally, expectations of positive home sales data from the US will support prices.
In the Indian markets, Rupee depreciation will restrict sharp negative movement in prices.