• Industrial metals (copper, aluminium, nickel, etc.) daily review (August 26, 2015)

    Base Metals

    Base metals on the LME traded higher yesterday as Beijing cut interest rates and lowered bank reserve requirements to support the domestic economy. The moves came after stocks around the world tumbled Monday on escalating fears about a slowdown in China’s economic growth.

    On the MCX, all the base metal prices except Nickel and Lead traded higher in line with trend in international markets.


    LME Copper prices jumped by 2.3 percent on Tuesday as the People's Bank of China cut interest rates by one-quarter of a percentage point and reduced bank reserve requirements by half a percentage point. This move followed the closing of Shanghai Composite Index down 7.6 per cent, after a similar decline on Monday.

    Further, Chile's deputy mining minister Ignacio Moreno said Tuesday that Copper prices should recover from its recent slide by late 2016 as the global market returns to deficit. Also, data showed US consumer confidence hit a seven-month high in August and Purchases of new homes in the U.S. rebounded in July, bolstering signs the real-estate market is picking up.

    MCX copper prices traded higher by 0.7 percent and closed at Rs.336.9/kg but Rupee appreciation capped sharp gains.


    We expect LME Copper prices to trade sideways as surprise rate cut by China along with expectations of deficit will be supportive. However, sharp volatility in the Shanghai markets increased uncertainties over the health of China’s economy. Also, expectations of weak Core Durable Goods Orders data will restrict sharp fall.

    On the MCX, copper prices are expected to trade lower today in line with international trends.

    Contributed by Angel Broking
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