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Commodities Industrial Metals

Industrial metals (copper, aluminium, nickel, etc.) daily review (June 11, 2014)

June 11, 2014, Wednesday, 08:52 GMT | 04:52 EST | 13:22 IST | 15:52 SGT
Contributed by Angel Broking


Base Metals

Base metals on the LME apart from Copper traded on a negative note yesterday taking cues from mixed global market sentiments. Also, mixed trend in LME inventories coupled with strength in the DX acted as negative factors.

However, sharp losses were cushioned on the positive jobs data from the US and favorable inflation data from China.

In the Indian markets, base metals traded lower in line with international markets.


Copper

LME Copper prices rose by 0.3 percent yesterday as China’s central bank announced a 0.5 percentage-point cut in reserve requirements for some banks, in line with statement by Chinese Premier Li Keqiang that policy makers will focus more on targeted measures to support economic growth. Further, favorable economic data from the biggest consumers, the US and China along with positive industrial production data from Euro Zone supported gains.

However, rise in risk aversion in the market sentiments coupled with strength in the DX capped sharp gains. The red metal closed at $6697/tonne on Tuesday.

MCX Copper prices gained 0.4 percent owing to Rupee depreciation and touched an intra-day high of Rs.401.15/kg before closing at Rs.400.9/kg in the last trading session.


Outlook

We expect LME Copper prices to trade mixed today as the measures by the China’s central bank boosted growth outlook and will act as a positive factor for the red metal. Also, expectations of decline in unemployment rate data from UK will support gains.

While on the other hand, strength in the DX along with rise in risk aversion in the market sentiments will cap sharp gains or even reversal in prices.

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

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