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Informist, Friday, Sep 20, 2024

By Ashutosh Pati

MUMBAI – Futures contracts of all base metals fell on the Multi Commodity Exchange of India as traders booked profits, analysts said. The sentiment was also hurt by rising base metal inventories, except copper, in warehouses monitored by the Shanghai Futures Exchange, they said.

"Metals have given back some gains after rallying Thursday on the Federal Reserve's interest-rate cut decision, which had incentivised investors toward riskier assets," Dow Jones quoted Daria Efanova, head of research at Sucden Financial, as saying in a note. 

However, the 50-basis-point interest rate cut by the US Federal Reserve is expected to stimulate corporate earnings and economic growth, Efanova said in a note. This will aid in the demand for base metals and support prices.

The base metals market is also exhibiting signs of improvement in China as premiums on imported copper have reached their highest levels since the start of the year, indicating increasing demand, Kotak Securities said in a note. 

Next week, the International Study Groups will meet to provide their semi-annual outlook for metal markets. "Since most markets will remain oversupplied for the time being, the current price recovery in the base metals markets is in danger of stalling," Commerzbank said in a report. These conferences are held twice a year - in the spring and fall.

COPPER prices fell because of profit-booking. The downside in copper prices was limited as copper inventories at Shanghai Futures Exchange-monitored warehouses fell by 20,582 tn from last week to 164,938 tn.

ALUMINIUM prices fell as inventories in Shanghai Futures Exchange-monitored warehouses rose by 2,722 tn from last week to 286,495 tn.
 

LEAD prices fell as lead stocks at Shanghai Futures Exchange-monitored warehouses rose by 9,523 tn from last week to 61,004 tn. There was a slight supply surplus for the lead market in July, following a deficit in the previous month, Commerzbank said, citing reports from the International Lead and Zinc Study Group. "This means that a supply surplus of almost 60,000 tons has accumulated in the first seven months," according to the report.

ZINC prices fell due to weakness in steel prices, as the metal is used for galvanisation.

At 1725 IST, on the MCX, the September futures contracts of:

- Aluminium was at 229.70 rupees per kg, down 0.9%

- Copper was at 813.45 rupees per kg, down 0.1% 

- Lead was at 184.45 rupees per kg, down 0.5%

- Zinc was at 266.90 rupees per kg, down 1%

Trading levels for the day on the MCX:

- Aluminium contract seen at 228.00-234.00 rupees 

- Copper contract seen at 804.00-825.00 rupees

- Lead contract seen at 183.00-188.70 rupees

- Zinc contract seen at 265.00-274.00 rupees

End

US$1 = 83.56 rupees

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

Edited by Saji George Titus

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