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Commodities Industrial Metals

Industrial metals (copper, aluminium, nickel, etc.) daily review (June 02, 2014)

June 2, 2014, Monday, 05:45 GMT | 00:45 EST | 09:15 IST | 11:45 SGT
Contributed by Angel Broking


Base Metals

Base metals on the LME apart from Aluminium traded on a negative note last week taking cues from mixed economic data from the US and unfavorable data from Euro Zone. Also, strength in the DX along with mixed global market sentiments acted as negative factors.

However, declining trend in LME inventories coupled with improving employment scenario in the US cushioned sharp downside.

In the Indian markets, base metals traded lower despite Rupee depreciation.


Copper

LME Copper prices declined by 1 percent last week owing to uneven recovery in the US, the second biggest consumer that fuelled concerns regarding the demand outlook. Also, string of unfavorable economic data from Euro Zone acted as a negative factor. Further, mixed global market sentiments exerted downside pressure on prices.

However, decline of 3 percent in inventories to 171,350 tonnes along with weakness in the DX acted as a positive factor. The red metal touched a weekly low of $6836/tonne and closed at $6843.5/tonne on Friday.

MCX Copper prices traded on a flat note last week and touched a weekly low of Rs.408.3/kg before closing at Rs.410.8/kg in the last trading session.


Outlook

We expect LME Copper prices to trade on a positive note today on the back of estimates of positive manufacturing data from the US in the evening session. Also, weakness in the DX coupled with upbeat market sentiments will act as a positive factor. Further, favorable manufacturing data from the biggest user China that came yesterday will support gains.

However, mixed economic data from Euro Zone and weak manufacturing data from UK will cap sharp gains in prices.

In the Indian markets, Rupee movement will provide further direction to prices.

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