Commodities

Industrial metals (copper, aluminium, nickel, etc.) daily review (September 26, 2012)

Contributed by Angel Broking

The base metals pack traded higher in yesterday's trading session on account of favourable economic data from the US along with decline in LME inventories apart from Copper.

However, sharp upside in the prices was capped as a result of rise in risk aversion in the global markets coupled with strength in the DX.

In the Indian markets, appreciation in the Rupee prevented sharp upside in the prices on the MCX.

Copper

Copper, the leader of the base metals pack increased by 0.9 percent yesterday on the back of more than expected rise in US consumer confidence data.

However, weak global market sentiments, stronger DX along with rise in LME Copper inventories by 0.2 percent which stood at 220,300 tonnes added downside pressure on the prices. The red metal touche d an intra-day high of $8,295/tonne and closed at $8,255.30/tonne in yesterday's trading session.

On the domestic front, prices gained by 0.6 percent and closed at Rs.445.0/kg after touching an intra-day high of Rs.446.30/kg on Tuesday. However, appreciation in the Indian Rupee capped sharp gains in the prices on the MCX.

Outlook

In today's session, we expect base metals to trade on a bearish note on the back of weak global market sentiments along with strength in the DX. Additionally, expectations that stimulus measures taken by central banks of the major economies will not be sufficient enough to boost the global economic growth will also add pressure on the prices. However, US consumer confidence which came on a positive note in the yesterday's session can cushion sharp fall in the prices.

In the Indian markets depreciation in the Rupee will also restrict sharp fall in the prices.