Informist, Friday, Sep 29, 2023
By Sayantan Sarkar
MUMBAI – Futures contracts of most base metals rose today on the Multi Commodity Exchange of India, tracking those on the London Metal Exchange, as the dollar fell sharply against a basket of major currencies, lifting demand for the metals.
A weaker dollar makes commodities priced in the greenback cheaper for holders of other currencies, lifting demand.
The dollar index fell below the psychologically crucial 106.00 mark today as 10-year US Treasury yields retreated from a multi-year high and investors booked profits.
COPPER contracts on MCX rose today, tracking those on the LME, as sentiments were boosted by production slippages in Chile, the top producer of the metal. According to the National Statistics Institute of Chile, production is down almost 4% since the beginning of the year.
“One reason is the sharp increase in mining costs: last month, the Chilean copper commission Cochilco reported that copper mining costs had soared by around 30% year-on-year in the first three months of the year,” Commerzbank AG said in a report.
As for ZINC, falling inventories in LME-accredited warehouses boosted sentiment in the market. “Accordingly, zinc price has done a U-turn and already gained by more than 8% compared with its August low,” the German bank said. “That said, we are sceptical about its further upside potential in view of the noticeable weakness of the construction sector in China and the eurozone, for example.”
At 1754 IST, on the MCX, the October futures contract of:
–ALUMINIUM was at 211 rupees a kg, up 1.4%
–Copper was at 726.8 rupees a kg, up 1.0%
–LEAD was at 188.25 rupees a kg, down 0.1%
–Zinc was at 231.8 rupees a kg, up 0.8%
Outlook for the evening session on the MCX:
–Aluminium contract seen at 205.80-213.3 rupees
–Copper seen at 713-737 rupees
–Lead seen at 186.0-193.9 rupees
–Zinc seen at 224–233 rupees
US$1 = 83.04 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Rajeev Pai
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