Informist, Thursday, Jun 9, 2022
By Sandeep Sinha
MUMBAI – Future contracts of all base metals traded lower on the Multi Commodity Exchange of India and the London Metal Exchange as a lockdown will be reimposed in parts of Shanghai from Saturday, despite better than expected economic data from China.
* Authorities put parts of Shanghai under a two-day stay-at-home order after fresh cases of COVID-19 were detected on Wednesday, to control transmission risks. A fresh lockdown will be imposed in the south-western district of Mihang from Saturday for mass testing, which dampened the sentiment for base metals.
* Exports from China jumped 16.9% on year in May and imports rose 4.1% on year last month due to reopening of the ports of Shanghai in the last week of May.
* "Better-than-expected export data from China has been more than offset by news that a south-western district in Shanghai will go back into lockdown from Saturday morning. It has only been free of restrictions since the beginning of June after 2 months of lockdown," Al Munro at broker Marex said in a note.
* Investors will take cues from the European Central Bank's Monetary Policy Committee meeting later today for any sign of tightening.
* However, the sharp downside in non-ferrous metals was capped by a fall in LME-approved warehouse inventory and weakness in the rupee, which makes commodities priced in dollars expensive for domestic buyers.
* ALUMINIUM prices slipped as traders raised short bets on the MCX. However, the downside was cushioned by a fall in LME inventory by 3,950 tn.
* COPPER prices fell due to demand concerns in China and a jump in LME stock by 1,275 tn.
* At 1700 IST, on the MCX, the June futures contract of:
--Aluminium was at 235.75 rupees, down 1.1%
--Copper was at 788.50 rupees a kg, down 1.1%
--LEAD was at 184.4 rupees a kg, down 0.4%
--ZINC was at 326.9 rupees a kg, down 1%
* Outlook for the evening session on MCX:
--Aluminium contract seen at 229.0-240.0 rupees per kg
--Copper seen at 785.0-797.0 rupees per kg
--Lead seen at 181.0-188.0 rupees per kg
--Zinc seen at 323.0–331.0 rupees per kg
End
US$1 = 77.77 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Vidhi Verma
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