MUMBAI (Commodity Online): The base metals surged on international and local markets on the back of short covering and China industrial production that came in line with the estimates. The markets ignored the hike of deposit reserve from China w.e.f 20 June 2011.
Soon after China CPI tested 34 months high the government announced the rise in deposit to be kept by financial institutions up by 0.5%. China's central bank said it would raise the banks' reserve requirement ratio (RRR) for sixth time this year, a move aimed to withdraw liquidity out of the market, as inflation remains stubbornly high.
China industrial output growth stood at 13.3% its lowest level since November 2010. However the estimates were in line with market and so the affect on the metals space remained absent.
In Europe, the emergency meeting for Greece between Eurozone Finance ministers ended without a result. The emergency meeting of Eurozone finance ministers had been called to build consensus on the degree of private sector involvement in the new rescue plan for debt-laden Greece.
In currency markets, Euro pushed forward against the Dollar after weak US retail sales data. Euro appreciated to 1.4442 at the time of settlement as against 1.4415 on Monday.
In US, the seasonally adjusted Producer Price Index for finished goods rose 0.2% in May, as per the U.S. Bureau of Labor Statistics report. This advance followed increases of 0.8% in April and 0.7 percent in March. US Retail Sales decreased by -0.2% in May, following a 0.3% rise in April, according to data provided by the US Census Bureau.
LME Copper forwards was at $ 9015 per ton in official rings, up $ 119 from Monday. Continuation of strike in El Teniente mine of Codelco consolidated the buying in the red metal. LME Aluminium appreciated by $ 14.5 to $ 2607 per ton. Battery material lead was up by $ 44 to end at $ 2564 per tonne.
On COMEX, the Copper contract closed at $ 4.166 per pound, the August expiry contract is trading with slight losses on Wednesday at $ 4.155 per pound.
On MCX, Copper moved up sharply at Rs 410.7 per kg, up 2.3%. Aluminium ended at Rs 117.3 per kg on Tuesday, up 1.7%. Nickel improved only marginally at Rs 1005.7 per kg, up 0.5%. Lead also gained Rs 115.5 per kg, up 1.6%.
