Base metal prices posted a mixed performance on the LME on Thursday with copper and aluminium ended in red while zinc, nickel and tin managed to end in the green territory.
The metal prices gained in the beginning of the trading session yesterday on the back of weakness in the Us Dollar Index (DX) but later dipped in consideration with weaker equity markets.
On the MCX, base metals pack ended up in the red mainly due to sharp at appreciation of the Indian Rupee (INR) on Thursday. Spot Rupee appreciated almost 1%, to close at 44.11 on Thursday.
US trade deficit gap widened by 8.8% to $46.3 billion in August, much more than the forecasts of deficit of $43.5 billion. Initial jobless claims in the US increased by 13,000 to reach 462,000 in the last week from the previous figure of 449,000 in the prior week. The producer price index (PPI) of US rose 0.4% in September, more than forecasts of 0.2% rise. The core PPI increased by 0.1% last month.
Copper prices declined around 0.3% on the LME, to close at $8377/tonne on Thursday. The red metal prices touched in intra-day low of $8370/tonne yesterday. On the MCX platform, copper prices slipped sharply by 0.5% to close at Rs.373.10/kg. Copper inventories on the LME increased by 225 tonnes to reach at 371,500 tonnes yesterday.
Nickel prices rallied, gaining more than 1.6% on the LME to close at $24,700/tonne on Thursday. However, on the MCX platform, nickel prices declined around by 0.4%, to close at Rs.1079.70/kg yesterday. Nickel inventories continued to increase climbing up by 36 tonnes to reach 124,176 tonnes on the LME yesterday.
OUTLOOK
On the macroeconomic front, there is a host of economic data to be released from the US in the evening session today. Empire state manufacturing index, consumer sentiment, and Federal budget balance are some of the crucial updates.
Moreover, investors are also keenly eyeing Ben Bernanke’s speech which may throw some light on the US economy and also further actions of the Federal Reserve to support the stalling growth in the world’s largest economy.
Property prices in China continued to rise despite steps incurred by the Chinese officials to rein the rising prices. This is indicating that further stringent steps should be implemented to curb the prices.
Today, base metal prices will take cues from the economic updates and the DX movement. Profit booking may be witnessed today, but sharp downside would be cushioned on the back of weaker DX.
Copper
Copper prices will trade with a sideways bias today with immediate support for MCX November contract seen at Rs.371.00 Further below; crucial support is seen at 368.00 levels.
Whereas resistance is seen at Rs. 376.00 levels & further upwards at Rs. 379.00 levels.
Zinc
Zinc prices will trade with a sideways bias today with immediate support seen at Rs.104.75 level for MCX October contract whereas crucial support is seen at Rs.103.90 level.
Short-term resistance is seen at Rs.106.85 whereas major resistance is seen at Rs 107.90 levels.
