Informist, Tuesday, May 24, 2022
By Sandeep Sinha
MUMBAI – Futures contracts of all base metals traded in the red on the Multi Commodity Exchange of India and the London Metal Exchange due to a broad-based sell-off across asset classes as participants became more risk averse. Weak demand from top consumer China due to ongoing COVID-19 lockdowns also dampened sentiment.
* “The recovery of metals’ prices appears to be over for now,” Commerzbank said in a report. “This is presumably due in part to weak stock markets in Asia and also to the somewhat firmer US dollar again”, the bank said.
* Base metals, which have already seen some substantive bounces, come back under pressure as China’s trade activity remains largely sidelined, Al Munro of Marex said in a note.
* Market players are waiting for US Federal Reserve Chief Jerome Powell’s speech at the National Center for American Indian Enterprise Development 2022 Reservation Economic Summit in Las Vegas later today for further cues.
* Eurozone’s composite Purchasing Managers’ Index dropped from 55.8 to 54.9 in May. A reading above 50 indicates expansion in the economic activity and a number below it signals contraction.
* However, the sharp downside in non-ferrous metals was cushioned by a continued decline in LME inventory and a weak dollar.
* ALUMINIUM prices fell on unwinding of long positions on the domestic bourse. Also weighing on price are demand concerns related to coronavirus lockdowns in China.
* COPPER prices slipped as traders rolled over their short positions on the MCX. However, the downside was limited by a fall in LME stocks by 425 tn.
* NICKEL contract plunged, tracking LME cues amid rising supply and weak demand for batteries from electric vehicle makers.
* At 1655 IST, on the MCX, the May futures contract of:
–Aluminium was at 242.7 rupees, down 1.9%
–Copper was at 776.10 rupees a kg, down 0.8%
—LEAD was at 184.30 rupees a kg, down 0.9%
–Nickel was at 2,100.0 rupees a kg, down 2.4%
—ZINC was at 322.95 rupees a kg, down 1.1%
* Outlook for the evening session on MCX:
–Aluminium contract seen at 240.0-248.5 rupees per kg
–Copper seen at 768.0-788.0 rupees per kg
–Lead seen at 182.2-187.5 rupees per kg
–Nickel seen at 2,050.0-2,200.0 rupees per kg
–Zinc seen at 318.5–330.0 rupees per kg
End
US$1 = 77.58 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Deepshikha Bhardwaj
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Source: Cogencis
