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Commodities Industrial Metals

Industrial metals (copper, aluminium, nickel, etc.) daily review (July 22, 2014)

July 22, 2014, Tuesday, 11:04 GMT | 06:04 EST | 14:34 IST | 17:04 SGT
Contributed by Angel Broking


Base Metals

Base metals on the LME traded higher largely due to driven by CTAs (commodity trading advisors), or managed futures funds. Zinc and hit a near three-year high and aluminium touched a new 16-month peak, as supply constraints prompted expectations of further gains. Zinc prospects have been driven by a paucity of huge new mine projects just as behemoths like Century in Australia dry up whereas years of smelter cutbacks due to depressed prices have eroded supply just as global demand recovers, in part due to a revival in the U.S. and European auto sectors and robust demand in China for Aluminium.

Also, positive outlook for the US economy supported gains in the base metals space.

In the Indian markets, all the base metals traded on a positive note taking cues from international trends.


Copper

LME Copper prices gained 0.5 percent yesterday as the money managed positions continued to be positive for the fourth week in a row. However, sharp gains were capped owing to rise in inventories and concerns regarding the property sector in China exerted downside pressure on prices. The red metal closed at $7029/tonne in the last session.

MCX Copper prices rose by 0.6 percent and closed at Rs.428.6/kg on Monday.


Outlook

We except LME Copper prices to trade sideways as weakness weakness in the DX coupled with rise in risk appetite in the market sentiments will act as a positive factor for prices.

While on the other hand, demand concerns in the biggest consumer, China will exert downside pressure on prices.

MCX Copper prices will trade sideways today taking cues from international markets.