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India Base Metals: Most down on firm rupee, China data weighs

Informist, Monday, Aug 1, 2022


By Sandeep Sinha


MUMBAI – Amid mixed cues from the London Metal Exchange, futures of most base metals on the Multi Commodity Exchange of India fell today due to a sharp rebound in the rupee against the dollar, which makes commodities priced in dollars cheaper for domestic buyers. Sentiment was further dampened by weak economic data from China.


* China’s manufacturing purchasing managers’ index slipped to 49 in July from 50.2 in June due to stalling of residential construction activity. A reading below 50 indicates contraction in economic activity and a number above 50 signals expansion. The country is the top user of non-ferrous metals.


ALUMINIUM prices slumped due to weak downstream demand amid a rebound in China’s production and rising inventory. Traders increasing their short positions on the MCX also weighed on prices.


* For further cues, investors will look at US ISM manufacturing purchasing managers’ index data later today.


* The downside in base metals was cushioned by weakness in the dollar against peer currencies, which makes dollar-denominated commodities cheaper for foreign holders. 


ZINC slipped due to profit booking after a sharp rally last week. However, the fall was limited by a decline in LME stocks by 775 tn.


* At 1650 IST, on the MCX, the August futures contract of:

 –Aluminium was at 211.50 rupees, down 1.6% 

 –Copper was at 656.70 rupees a kg, down 0.1% 

 –Lead was at 178.70 rupees a kg, up 0.4%

 –Zinc was at 294.0 rupees a kg, down 0.6%


* Outlook for the evening session on MCX:

 –Aluminium contract seen at 210.20-218.0 rupees a kg

 –Copper seen at 649.0-666.0 rupees a kg

 –Lead seen at 175.70-180.20 rupees a kg

 –Zinc seen at 291.40–298.60 rupees a kg




US$1 = 79.02 rupees

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


Edited by Avishek Dutta


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Source: Cogencis

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