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Informist, Thursday, Nov. 28, 2024

By Ashutosh Pati

MUMBAI – Futures contracts of most base metals fell on the Multi Commodity Exchange of India and the London Metal Exchange Thursday because of a firm dollar. The sentiment was also weighed down by concern about the trade tariffs that US President-elect Donald Trump has pledged to impose on Chinese goods, analysts said.

At 1730 IST, the dollar index, which measures the strength of the greenback against a basket of six major currencies, was up 0.2% at 106.23. A stronger dollar makes commodities, such as base metals, priced in the greenback expensive for buyers holding other currencies.

Worries about a trade war with China were heightened by the announcement that Jamieson Greer would be Trump’s US trade representative, Daniel Hynes, senior commodity strategist at ANZ Research, said in a note. Greer, a trade lawyer, worked with Trump during his first term as president, and played a key role in imposing tariffs on goods from China.

Trading volumes have been on the lower side as the US market is shut Thursday for the Thanksgiving Holiday. Traders stayed on the sidelines and avoided taking major fresh positions until next week.

For further cues, investors await China's Manufacturing Purchasing Managers' Index due Saturday. They will also watch out for China's Caixin Manufacturing Purchasing Managers' Index due next week.

ALUMINIUM prices fell, taking cues from the LME, due to a firm dollar. Prices declined after Chinese industrial companies reported a 10% drop in October profits, marking the third consecutive month of declines, Kotak Securities said in a note.   

COPPER prices fell, taking cues from the LME, as inventories at warehouses registered with the LME rose by 1,475 tonnes to 270,525 tonnes. 

ZINC prices fell as inventories at LME-registered warehouses rose by 7,725 tonnes to 268,625 tonnes. "European power and gas prices came off from their peak which is weighing on zinc prices," Al Munro, strategist at London-based brokerage Marex, said in a note.

At 1735 IST, on the MCX, the December futures contract of:

–Aluminium was at INR 241.10 a kg, down 0.3%

–Copper was at INR 805.60 a kg, down 0.3%

–LEAD was at INR 180.55 a kg, up 0.3%

–Zinc was at INR 282.45 a kg, down 1.8%

Trading levels for the day on the MCX:

-Aluminium contract seen at INR 237.90-246.30

-Copper contract seen at INR 799.90-816.40

-Lead contract seen at INR 178.50-181.80

-Zinc contract seen at INR 281.00-294.20

End

US$1 = INR 84.49

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

Edited by Rajeev Pai

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