India Base Metals: Rise on bargain buying, technical rebound

India Base Metals: Rise on bargain buying, technical rebound

Informist, Thursday, Aug 17, 2023


By Sandeep Sinha


MUMBAI – Futures contracts of all base metals rose on the Multi Commodity Exchange of India and London Metal Exchange due to bargain buying in the physical market, as market players assessed the hawkish tone of Federal Reserve's July meeting minutes.


The US Federal Open Market Committee's July meeting minutes showed that that officials continue to have a bias to hike interest rate further with inflation staying above their comfort level. 


Non-ferrous metals are in deep oversold levels and are seeing some technical rebound from the lower levels. 


Further, US industrial production rose 1% on month in July driven by growth in utilities, manufacturing and mining, which supported base metals prices.


"Base metals recovered after the recent slump, China's top leaders pledged to expand domestic consumption and support the private sector without detailing any new stimulus measures, the latest in a series of rhetorical attempts to boost confidence in the economy as markets sink and growth disappoints," Kotak Securities said in a note.


The continued weak economic data from top consumer China and a lack of fresh stimulus announcement limited the upside in the non-ferrous metals.


ALUMINIUM prices rose due to a fall in stocks by 1,500 tn at LME-accredited warehouses. Traders covering their short positions on the domestic exchange also aided prices.


COPPER prices were in the positive territory on value buying and a weakness in the dollar. However, the upside was limited due to rise in stocks at LME-registered warehouses by 525 tn to 91,400 tn.


LEAD contracts gained tracking positive cues from other base metals. Traders increasing their long positions on the domestic exchange also supported the prices.


ZINC contracts rose on technical rebound after a sharp sell-off in the last few days. However, rising stocks at LME-approved warehouses restricted further upside in the price.


* At 1619 IST, on the MCX, the August futures contract of:

–Aluminium was at 198.30 rupees a kg, up 0.7%

–Copper was at 722.95 rupees a kg, up 0.3%

–Lead was at 184.05 rupees a kg, up 0.3%

–Zinc was at 211.50 rupees a kg, up 0.7%


* Outlook for the evening session on the MCX:

–Aluminium contract seen at 195.50-200.10 rupees

–Copper seen at 719.20-724.90 rupees

–Lead seen at 183.40-184.25 rupees

–Zinc seen at 208.20–212.0 rupees




US$1 = 83.15 rupees

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT


Edited by Aditya Sakorkar


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