India Base Metals
All down on risk aversion, firm dollar
This story was originally published at 18:58 IST on 16 July 2024
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By Sandeep Sinha
MUMBAI – Futures contracts of all base metals fell today on the Multi Commodity Exchange of India and the London Metal Exchange because of risk aversion and a firm dollar. A stronger greenback makes dollar-denominated commodities expensive for holders of other currencies, denting their demand.
At 1725 IST, the dollar index, which measures the strength of the greenback against a basket of six major currencies, was up 0.1% at 104.29.
"Base metals are trading mostly lower after disappointing second-quarter GDP data in top consumer China clouded the demand forecast for the base metals, but traders remain optimistic that the government will announce new stimulus measures during this week's Third Plenum," Kotak Securities said in a note.
Investors will take cues from US retail sales data, due later today. They will also watch out for US industrial production and building permits and housing starts data on Wednesday.
ALUMINIUM prices fell due to rising production in China and weak demand.
COPPER prices fell because of rising inventories at Shanghai Futures Exchange and LME. LME stocks at exchange-reported warehouses rose by 6,150 tn to 216,475 tn today, the highest since October 2021.
LEAD contracts traded lower as market participants increased their short positions on the domestic exchange.
ZINC contracts pared earlier gains and turned red because of weakness in steel prices, as the metal is used for galvanisation.
* At 1735 IST, on the MCX, the July contract of:
–Aluminium was at 225.60 rupees a kg, down 0.7%
–Copper was at 853.00 rupees a kg, down 0.3%
–Lead was at 189.10 rupees a kg, down 0.2%
–Zinc was at 272.05 rupees a kg, down 0.8%
* Outlook for the evening session on the MCX:
–Aluminium contract seen at 224.90-227.70 rupees
–Copper seen at 846.60-862.80 rupees
–Lead seen at 187.70-191.20 rupees
–Zinc seen at 270.70-274.50 rupees
End
US$1 = 83.58 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Tanima Banerjee
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