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Informist, Thursday, May 15, 2025

By Ashutosh Pati

MUMBAI – Futures contracts of most base metals fell on the Multi Commodity Exchange of India and the London Metal Exchange Thursday as traders resorted to book profits after sharp gains this week. Market sentiment was also hurt as optimism around the US-China trade deal seems to fade, according to analysts.

The US and China Monday agreed to lower tariffs for 90 days. The US reduced its reciprocal tariff on Chinese goods to 10% from 125%. With the 20% tariffs announced in February and March against Chinese goods remaining in place, the total tariff against Chinese goods will now be 30%. At the same time, China agreed to cut tariffs on US goods to 10% from 125%. However, the lack of a long-term solution has weighed on sentiment across industrial metals.

"Despite initial gains earlier this week on hopes of improved trade flows, markets have grown cautious again due to the lack of a long-term resolution and lingering concerns over China's economic resilience," Kotak Securities said in a report. "Copper is extending losses for a second session amid persistent global trade uncertainties, as optimism from the recent 90-day US-China tariff pause fades."

The losses in base metal prices were limited by a weak dollar and a fall in stocks at LME-accredited warehouses. At 1709 IST, the dollar index, which measures the strength of the greenback against a basket of six major currencies, was down 0.2% at 100.84. A weaker dollar makes commodities such as base metals that are priced in the greenback, cheaper for buyers holding other currencies, hence aiding demand.

ALUMINIUM inventories at warehouses registered with the LME fell by 2,025 tonnes to 397,275 tonnes and COPPER stocks fell by 925 tonnes to 184,650 tonnes. ZINC inventories fell by 1,875 tonnes to 165,175 tonnes.

Market participants are waiting for the US producer price index data and a speech by Federal Open Market Committee Chair Jerome Powell, both due later in the day.

At 1713 IST, on the MCX, the May futures contract of:

–Aluminium was at INR 240.60 a kg, down 1.4%

–Copper was at INR 857.00 a kg, down 0.3%

–LEAD was steady at INR 178.55 a kg 

–Zinc was at INR 257.90 a kg, down 1% 

Trading levels for the day on the MCX:

--Aluminium contract seen at INR 235.60-INR 247.00

--Copper contract seen at INR 839.90-INR 868.60

--Lead contract seen at INR 176.20-INR 180.50

--Zinc contract seen at INR 251.20-INR 264.20

End

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

Edited by Subhojit Sarkar

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