• Industrial metals (copper, aluminium, nickel, etc.) daily review (September 16, 2015)

    Base Metals

    Base metals on the LME apart from Zinc traded higher yesterday owing to prospects of delay in US rate hike given the current uncertain global scenario supported the metals pack.

    However, sharp gains were capped as Chinese equity markets continue their downside along with strength in the DX.

    On the MCX, all the base metal prices traded higher except Zinc in line with international trends.


    Copper

    LME Copper prices surged by 0.7 percent on Tuesday as supply disruption concerns were taken in to consideration by investors as Glencore last week shocked markets with a decision to shut two large copper mines in Africa, taking roughly 400,000 metric tons of annual copper supply off the market, following moves by Freeport McMoRan Inc. and Chile's Codelco to scuttle expansion projects. Also, gain of 1 percent in LME stocks acted as a positive factor.

    However, uncertainty ahead of the FOMC statement gave jitters to markets across the globe and hurt risk appetite. Also, strength in the DX following retail sales data which hasnít fallen for six straight months, a sign that a year of lower gasoline prices is percolating down to consumers restricted gains. Besides, persistent demand concerns from China exerted pressure on the metal.

    MCX copper prices jumped by 1 percent and closed at Rs.361.2/kg in line with international trends.


    Outlook


    We expect Copper prices to trade higher today supported by supply disruption concerns and gain in Asian equities. However, investors remain cautious ahead of FOMC statement due Thursday. Also, investors will keenly await US CPI data to be released tonight.

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

    Contributed by Angel Broking
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