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Commodities Industrial Metals

Industrial metals (copper, aluminium, nickel, etc.) daily review (June 19, 2014)

June 19, 2014, Thursday, 05:44 GMT | 00:44 EST | 09:14 IST | 11:44 SGT
Contributed by Angel Broking


Base Metals

Base metals on the LME traded on a mixed note yesterday taking cues from yet another round of tapering of $10 billion from the QE program. Also, mixed market sentiments acted as a negative factor.

However, declining trend in inventories capped sharp gains. Further, weakness in the DX supported gains.

In the Indian markets, base metals traded higher owing to Rupee depreciation.


Copper

LME Copper prices traded on a flat note yesterday owing to statement by the Federal Reserve Chairwoman Janet Yellen that the Fed is likely to reduce the pace of asset purchases in further measured steps as the US economy is on the path of recovery.

Also, optimism regarding attempts by the Chinese Government to support growth along with weakness in the DX cushioned sharp downside. Further, decline of 0.3 percent in inventories to 160,675 tonnes added an upside to prices. The red metal touched an intra-day low of $6692.5/tonne and closed at $6718/tonne on Wednesday.

MCX Copper prices declined by 0.3 percent and touched an intra-day low of Rs.405.85/kg before closing at Rs.407.4/kg in the last trading session.


Outlook

We expect LME Copper prices to trade on a positive today as the optimism regarding the US and Chinese economic recovery will lead to positive demand outlook for the metal. Also, weakness in the DX coupled with upbeat market sentiments will support gains in prices.

However, expectations of weak economic data from the US and UK will restrict sharp upside.

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