Informist, Monday, May 29, 2023
By Sandeep Sinha
MUMBAI – Futures contracts of most base metals rose on the Multi Commodity Exchange of India on improved risk appetite, a rally in the equity markets, and a retreat in the dollar after US President Joe Biden and House Speaker Kevin McCarthy reached a tentative agreement on raising the government’s debt ceiling.
However, volumes were on the lower side owing to a lack of fresh cues from the London Metal Exchange which was shut today for the Spring Bank Holiday in the UK.
The dollar index, which measures the strength of the greenback against a basket of major currencies, was down 0.1% at 104.21. A weaker greenback makes dollar-denominated commodities cheaper for holders of other currencies.
“Base metals traded higher on Monday as risk sentiment improved after US leaders reached a tentative debt ceiling deal, possibly averting a default in the world’s largest economy,” said Saumil Gandhi, senior analyst-commodities at HDFC Securities. “However, concerns about further interest rate hikes and weak demand capped gains.”
Data from China’s National Bureau of Statistics showed industrial profits in the first four months of the calendar year fell 20.6% on year indicating weakening demand in the world’s biggest consumer.
Investors are now keenly waiting for the release of US April nonfarm payrolls later this week for further cues.
ALUMINIUM prices were flat due to lack of fresh triggers.
COPPER prices gained on improved risk appetite and weakness in the dollar. However, the upside was capped by rising inventories at LME-accredited warehouses.
LEAD contracts fell due to profit-taking by traders on the domestic bourse.
ZINC contracts rose as market participants increased their long positions on the MCX.
* At 1750 IST, on the MCX, the June futures contract of:
–Aluminium was at 207.85 rupees a kg, unchanged
–Copper was at 715.40 rupees a kg, up 0.4%
–Lead was at 183.85 rupees a kg, down 0.1%
–Zinc was at 212.70 rupees a kg, up 0.6%
* Outlook for the evening session on the MCX:
–Aluminium contract seen at 206.90-208.80 rupees
–Copper seen at 710.60-716.90 rupees
–Lead seen at 183.30-184.80 rupees
–Zinc seen at 210.70–213.0 rupees
End
US$1 = 82.62 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Rajeev Pai
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