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Informist, Friday, Jul 26, 2024

By Sandeep Sinha

MUMBAI – Futures contracts of most base metals traded in the green today on the Multi Commodity Exchange of India and the London Metal Exchange because of the weakness in the dollar. A weaker greenback makes dollar-denominated commodities such as base metals cheaper for holders of other currencies.

The positive sentiment in non-ferrous metals was also boosted by a fall in stocks at LME-registered warehouses. The exchange stocks of ALUMINIUM fell 3,550 tn to 943,675 tn, COPPER stocks declined 1,675 tn to 237,750 tn, LEAD stocks were down 3,850 tn to 247,025 tn, and ZINC stocks dropped 1,625 tn to 242,350 tn.

At 1605 IST, the dollar index, which measures the strength of the greenback against a basket of six major currencies, was down 0.1% at 104.35.

Investors will take further cues from the US Core Personal Consumption Expenditures Price Index, the preferred inflation gauge of the US Federal Reserve, due later today. They will also look forward to the US Federal Open Market Committee interest rate decision and Bank of Japan policy decision next week.

ALUMINIUM prices rose as traders increased their long positions on the domestic exchange.  

COPPER prices gained as market participants raised their long positions on the MCX.

"In the short term, risks remain to the downside for both physical demand and sentiment, particularly related to China and the slowdown in the country’s property and construction sectors. This also means that copper prices are likely to remain volatile, responding to any changes in Chinese policies," ING Economics said in a report.

LEAD prices traded higher due to short-covering by traders on the domestic exchange.

ZINC contracts traded lower because of concerns relating to demand from the property sector in top consumer China.

At 1620 IST, on the MCX, the August futures contract of:

–Aluminium was at 212.25 rupees a kg, up 0.4%

–Copper was at 801.50 rupees a kg, up 0.7%

–Lead was at 186.10 rupees a kg, up 0.4%

–Zinc was at 251.75 rupees a kg, down 0.2%

Outlook for the evening session on the MCX:

–Aluminium contract seen at 209.30-214.90 rupees

–Copper seen at 786.10-812.00 rupees

–Lead seen at 184.20-188.20 rupees

–Zinc seen at 247.90-259.75 rupees

End

US$1 = 83.73 rupees

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

Edited by Vidhi Verma

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