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Informist, Wednesday, Apr. 2, 2025

By Ashutosh Pati

MUMBAI – Futures contracts of all base metals traded in the red on the Multi Commodity Exchange of India and the London Metal Exchange on Wednesday, as market participants navigated uncertainties around US President Donald Trump's impending reciprocal tariffs. Investors remain worried that a potential trade war could derail global economic growth and hurt demand for metals.

Trump is expected to announce reciprocal tariffs later in the day. The tariffs are aimed at reducing America's dependence on foreign goods and discouraging other countries from imposing unfair duties on US exports. The tariffs will take effect immediately upon announcement.

"The announcement could reshape global trade dynamics, with potential levies on metals, including copper. Market sentiment remained on edge, with traders weighing the risk of retaliatory measures and broader economic disruptions," Kotak Securities said in a report.

However, losses in base metals prices were limited by stronger-than-expected manufacturing data from China. The Caixin China Manufacturing Purchasing Managers' Index rose to a four-month high of 51.2 in March from 50.8 in the previous month. This marked the sixth successive month in which the index was above the 50.0 mark, signalling an improvement in manufacturing sector conditions. A reading below 50 indicates a contraction in economic activity while a number above 50 signals expansion.

China's official Purchasing Managers' Index rose to 50.5 in March from 50.2 in February, reaching a 12-month high, according to the National Bureau of Statistics. The official Manufacturing PMI has remained in expansion territory in five of the past six months. China is the major producer and consumer of non-ferrous metals and positive economic data could boost demand for metals in the country.

At 1700 IST, on the MCX, the April futures contract of:

-–ALUMINIUM was at INR 243.25 a kg, down 0.6%

–-COPPER was at INR 893.25 a kg, down 0.1%

–-LEAD was at INR 177.90 a kg, down 0.9%

–-ZINC was at INR 265.20 a kg, down 0.9%

Trading levels for the day on the MCX:

--Aluminium contract seen at INR 239.00-INR 247.60

--Copper contract seen at INR 880.50-INR 908.80

--Lead contract seen at INR 176.20-INR 180.90

--Zinc contract seen at INR 261.80-INR 271.10

End

US$1 = INR 85.50

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

Edited by Subhojit Sarkar

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