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Informist, Thursday, Oct. 3, 2024

By Ashutosh Pati

MUMBAI – Futures contracts of all base metals fell on the Multi Commodity Exchange of India, tracking losses on the London Metal Exchange because of a firm dollar, which makes commodities priced in the greenback expensive for holders of other currencies. However, the downside in base metal prices was restricted by hopes of an improvement in demand after the slew of stimulus measures announced by China.

The world's top consumer of base metals recently cut interest and mortgage rates and eased restrictions on purchasing of houses. These measures could boost the Chinese economy and demand for metals. "A gauge of Chinese property stocks surged as much as 16% on Wednesday, signalling optimism that the sector can reverse its prolonged decline," Daniel Hynes, analyst at ANZ Research, said in a note. "Confidence that the Chinese economy's outlook is improving was supported by data showing 2.14 million railway trips on the first day of the national holiday, up 6.7% on year, which suggests consumers are more willing to spend," he said.

At 1808 IST, the dollar index, which measures the strength of the greenback against a basket of major currencies, was up 0.3% at 101.86.

Prospects of further interest rate cuts by the US Federal Reserve also restricted losses, analysts said. According to the CME Fedwatch tool, the odds of a 25-basis-point interest rate cut at the Fed's November meeting are 64.8% and the odds of a 50-bps rate cut are at 35.2%. "Further hopes of lower interest rates would also increase demand hopes," Kotak Securities said in a note.

COPPER prices fell on the MCX, tracking losses on the LME because of a firm dollar. The sentiment was also hurt as the global copper surplus widened to 528,000 tonnes in Jan-Jul this year from 79,000 tonnes in the corresponding period last year. Global refined copper production rose 5.9% on year to 16.1 million tonnes in Jan-Jul, the International Copper Study Group said in a report.

The downside in ALUMINIUM prices was limited as inventories in LME-registered warehouses fell by 2,500 tonnes to 785,450 tonnes.

At 1812 IST, on the MCX, the September futures contracts of:

- Aluminium was at INR 238.75 per kg, down 0.4%

- Copper was at INR 852.70 per kg, down 0.5% 

- LEAD was at INR 184.20 per kg, down 0.1%

- ZINC was at INR 283.75 per kg, down 0.3%

Trading levels for the day on the MCX:

- Aluminium contract seen at INR 237.10-INR 246.00 

- Copper contract seen at INR 845.00-INR 869.00 

- Lead contract seen at INR 183.00-INR 188.00 

- Zinc contract seen at INR 284.00-INR 294.50

End

US$1 = INR 83.96

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

Edited by Rajeev Pai

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