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Informist, Friday, Sep 13, 2024

By Ashutosh Pati

MUMBAI – Futures contracts of copper and aluminium rose on the Multi Exchange of India today tracking gains on the London Metal Exchange because of a weak dollar. A weaker greenback makes dollar-denominated commodities, such as copper and aluminium, cheaper for holders of other currencies. The upside in prices of copper and aluminium was supported by a fall in inventories at warehouses as well.

At 1556 IST, the dollar index, which measures the strength of the greenback against a basket of major currencies, was down 0.2% at 100.98.

COPPER stocks at Shanghai Futures Exchange-monitored warehouses fell by 29,854 tn from last week to 185,520 tn, according to exchange data.

ALUMINIUM stocks at Shanghai Futures Exchange-monitored warehouses fell by 2,174 tn from last week to 283,773 tn and inventories at LME-registered warehouses fell by 3,500 tn to 824,350 tn, according to exchange data. However, China's production in August may have been slightly higher, which could weigh on prices in the short term, Commerzbank said in a report, citing initial estimates by Shanghai Metals Markets research group.

Market sentiment is positive after the European Central Bank lowered its deposit facility rate, through which it steers the monetary policy stance, by 25 basis points, analysts said. Traders are now waiting for the US Federal Open Market Committee meeting next week. The probability of a 25-basis-point interest rate cut by the US Federal Reserve is 55% and that of a 50-bps cut is 45%, according to the CME FedWatch tool.

Moreover, China might cut interest rates on over $5 trln of outstanding mortgages as early as this month to reduce borrowing costs and stimulate consumption, Kotak Securities said in a note, citing Bloomberg reports.

At 1600 IST, on the MCX, the September futures contracts of:

- Aluminium was at 225.80 rupees per kg, up 0.4%

- Copper was at 799.70 rupees per kg, up 0.1%

- LEAD was at 184.20 rupees per kg, down 0.4%

- ZINC was at 263.95 rupees per kg, down 0.2%

Trading levels for the day on the MCX:

- Aluminium contract seen at 221.75-228.80 rupees 

- Copper contract seen at 797-804.50 rupees

- Lead contract seen at 182.65-186.50 rupees

- Zinc contract seen at 262.50-266.70 rupees

End

US$1 = 83.88 rupees

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

Edited by Ashish Shirke

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