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Informist, Friday, May 30, 2025

By Ashutosh Pati

MUMBAI – Futures contracts of most base metals fell on the Multi Commodity Exchange of India, tracking a fall in contracts on the London Metal Exchange because of a firm dollar. Market sentiment was further hurt after the US appeals court temporarily reinstated the tariffs on Thursday, a day after a federal court had struck them down.

At 1833 IST, the dollar index, which measures strength in the greenback against a basket of six major currencies, was up 0.1% at 99.41. A stronger dollar makes dollar-denominated commodities such as base metals expensive for those holding other currencies, thereby, denting demand.

"LME base metals traded lower, extending early-session weakness as market sentiment turned cautious following a federal appeals court decision to temporarily reinstate President Trump's broad tariff agenda," Kotak Securities said in a report.

However, a fall in stocks of most metals at warehouses registered with the Shanghai Futures Exchange limited the downside in base metal prices. ALUMINIUM inventories fell 16,856 tonnes to 124,433 tonnes and ZINC inventories fell by 1,763 tonnes to 42,310 tonnes. LEAD stocks fell by 1,928 tonnes to 46,500 tonnes, while COPPER inventories rose by 7,120 tonnes to 105,791 tonnes.

Copper prices were steady, slightly supported because of supply concerns, according to Kotak Securities. Market participants are waiting for China's manufacturing purchasing managers' index due early Saturday.

"After the US and Chinese leaders agreed on a significant reduction of the absurdly high tariffs, sentiment among companies is likely to have brightened considerably. However, the US tariffs on Chinese imports are likely to remain at an economically damaging level. If Chinese companies also see it this way, metal prices could face headwinds at the start of the new week," Thu Lan Nguyen, head of FX and commmodity research at Commerzbank, said in a report.

At 1849 IST, on the MCX, the June futures contract of:

–Aluminium was at INR 236.10 a kg, down 0.2%

–Copper was steady at INR 862.70 a kg

–Lead was at INR 177.95 a kg, down 0.1% 

–Zinc was at INR 252.00 a kg, down 0.9% 

Trading levels for the day on the MCX:

--Aluminium contract seen at INR 232.20-INR 240.30

--Copper contract seen at INR 853.80-INR 872.60

--Lead contract seen at INR 176.60-INR 179.20

--Zinc contract seen at INR 249.60-INR 258.20

End

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

Edited by Akul Nishant Akhoury

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