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India Base Metals: Most up as risk appetite improves, dollar weakens

Informist, Thursday, Aug 11, 2022


By Sandeep Sinha


MUMBAI – Most base metals futures on the Multi Commodity Exchange of India and the London Metal Exchange rose due to improved risk sentiment, weakness in the dollar, and a broad-based rally across assets class after data showed lower-than-expected inflation in the US.


* The US Labour Department said the consumer price index fell to 8.5% on year in July from a four-decade high of 9.1% in June on lower fuel prices, airline fares, clothing and education costs.


* The dollar index, which measures the strength in the greenback against a basket of major currencies, was down 0.2% at 104.95. A weaker greenback makes dollar-denominated commodities such as non-ferrous metals cheaper for holders of other currencies.


* The premium of cash LME ZINC over the three-month contract rose to $127 per tn, suggesting tightness in near-term LME supplies as market players were concerned that high energy prices will force smelters to further curb output.


* However, the upside was capped by a jump in LME inventories of COPPER, LEAD, NICKEL and zinc. The only exception was ALUMINIUM, whose stocks fell by 3,575 tn.


* Market players will await the US producer price index, core producer price index, and unemployment claims data to be released later today.


* Aluminium prices rose as traders increased their long positions on the MCX, and due to a fall in LME inventory.


* Copper prices rose as refined copper production in China fell 2.5% on month to 840,000 tn in July and many smelters were under maintenance, according to Shanghai Metals Market. The US Federal Reserve may not go for an aggressive rate hike as inflation data was weak, and this also supported prices of the metal.


* At 1640 IST, on the MCX, the August futures contract of:

 –Aluminium was at 217.20 rupees, up 0.9% 

 –Copper was at 678.75 rupees a kg, up 1.4% 

 –Lead was at 183.40 rupees a kg, down 0.1%

 –Zinc was at 322.0 rupees a kg, up 0.5%


* Outlook for the evening session on MCX:

 –Aluminium contract seen at 212.70-221.30 rupees a kg

 –Copper seen at 662.0-690.0 rupees a kg

 –Lead seen at 181.70-186.20 rupees a kg

 –Zinc seen at 317.60–324.90 rupees a kg




US$1 = 79.63 rupees

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


Edited by Avishek Dutta


For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.


Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.


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Source: Cogencis

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