Informist, Monday, Feb 12, 2024
By Sandeep Sinha
MUMBAI – Futures contracts of most base metals on the Multi Commodity Exchange of India rose today, taking positive cues from the London Metal Exchange, because of short-covering and positive commentary from the International Monetary Fund. However, the upside was limited by the firm dollar.
The global economy is "poised for a soft landing" and expects interest rates to go down around the middle of 2024, Kristalina Georgieva, managing director of the IMF said. The comment cheered the markets and lifted sentiment in base metals.
The dollar index, which measures the strength of the greenback against a basket of six major currencies, was up 0.2% at 104.16 at 1730 IST on the fading chance of an early rate cut by the US Federal Reserve. A stronger greenback makes dollar-priced commodities such as base metals expensive for holders of other currencies.
"After a price drift overnight, metals benefiting on the open from a pickup amid an apparent mean reversion type bid," Al Munro at broker Marex said in a note.
Investors will now keep an eye on the US CPI data, due Tuesday, to gauge the Fed's next move. However, volumes are likely to stay down as most traders shy away from taking large positions owing to the Chinese Lunar New Year holiday.
ALUMINIUM prices fell on a sharp jump in stocks at the Shanghai Futures Exchange warehouse by 475,000 tn on Thursday.
COPPER contracts were a tad higher, taking firm cues from the LME because of a fall in stocks by 525 tn at LME-accredited warehouses. Short-covering of positions by traders on the MCX also lifted the price.
At 1745 IST, on the MCX, the February futures contract of:
–Aluminium was at 200.05 rupees a kg, down 0.2%
–Copper was at 704.20 rupees a kg, up 0.1%
–LEAD was at 176.95 rupees a kg, up 1%
–ZINC was at 208.65 rupees a kg, up 0.5%
Outlook for the evening session on the MCX:
–Aluminium contract seen at 198.0-203.50 rupees
–Copper seen at 699.0-708.0 rupees
–Lead seen at 174.50-179.0 rupees
–Zinc seen at 206.0-215.0 rupees
End
US$1 = 83.00 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Rajeev Pai
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