Informist, Wednesday, Nov 23, 2022
By Sandeep Sinha
MUMBAI – Prices of copper rose on the Multi Commodity Exchange of India and the London Metal Exchange because of weakness in the dollar on expectations of a smaller rate hike by the US Federal Reserve at its upcoming meeting. A fall of 1,375 tn in LME stocks at 90,150 tn and firm demand in North America and Europe supported the positive cues.
* The dollar index fell 0.1% to 106.03. A weaker greenback makes dollar-denominated commodities cheaper for buyers of other currencies.
* “LME base metals traded higher buoyed by hopes of a RRR cut soon as China signalled monetary stimulus to provide much-needed economic respite amid worsening COVID situation and recent curbs,” Kotak Securities said in a report.
* Commodities may not see any major volatility in the evening session as US markets are closed on account of Thanksgiving, the brokerage firm added.
* “As many wind down into year-end and intraday volatility increases amid lighter trading activity, nobody seems to factor in the likelihood of treading water. Path of most pain is that we don’t move…,” Al Munro at broker Marex said in a note.
* The German Ifo business climate index rebounded to 86.3 in November from 84.5 in October. The reading suggests that Europe’s largest economy is stabilising because of government stimulus.
* However, further tightening by Chinese authorities to curb rising cases of COVID-19 capped the upside in base metals. The country is the biggest producer and consumer of non-ferrous metals.
* ALUMINIUM contracts rose due to short-covering of positions by traders on the domestic bourse and a decline of 3,825 tn in LME inventory.
* At 1735 IST, on the MCX, the November futures contract of:
–Aluminium was at 207.0 rupees a kg, up 0.2%
–Copper was at 671.90 rupees a kg, up 0.4%
–LEAD was at 183.0 rupees a kg, unchanged at 0.0%
–ZINC was at 260.25 rupees a kg, down 0.1%
* Outlook for the evening session on the MCX:
–Aluminium contract seen at 203.75-210.0 rupees a kg
–Copper seen at 665.0-677.50 rupees a kg
–Lead seen at 181.0-184.50 rupees a kg
–Zinc seen at 258.50–264.0 rupees a kg
US$1 = 81.63 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Avishek Dutta
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