Short covering was seen in Copper, Nickel and Aluminium at MCX
Base metals recouped previous session losses and trading in positive territory on Monday, 28th November amid the floundering US dollar and short covering as the hopes on Euro zone policymakers to come out with solvency steps to shun off the crisis has been escalating. Metals accounted for early gains during the mid session following the report that suggested IMF was preparing a rescue plan of worth 600 billion euros for Italy. It continued to held onto the gains even after IMF denied the rescue plan.
Investor's hopes on European finance ministers summit on Tuesday who are expected to approve detailed operational rules for the euro zone's bailout fund, which will clear the way for the 440 billion euro facility to attract cash from private and public investors to its co-investment funds in coming weeks driving the market still in positive direction.
Additionally, Germany and France are exploring radical methods of securing deeper integration among euro zone countries to be able to shore up the region's defenses against the debt crisis weighing on the sentiment.
But, investor's remained cautious against the Moody's warning that “continued rapid escalation of the euro-area sovereign and banking-credit crisis is threatening the credit standing of all European sovereigns.”
The US new home sales data for the month of October 2011, which is due to be released tomorrow was also under focus.
The dollar index slumped by 0.99% at 78.84 against the basket of 6 major currencies hampered by the rise in euro and equities on hopes over European debt crisis resolution.
In domestic market at MCX, Copper for delivery in November was strengthening by 2.08% or Rs. 7.85 at Rs. 385.4 per kg and tested a high of Rs. 386.8 per kg and low of Rs. 378.8 per kg in intraday. The contract was trading above 50-day EMA and RSI stood at 52.82.
MCX Nickel for delivery in November tested a high of Rs. 906.5 per kg and low of Rs. 895 per kg in intraday and is now trading at Rs. 901.2 per kg, down 1.3% or Rs. 11.6. Zinc was trading flat at Rs. 100.6 per kg. Aluminium was firming by 0.96% or Rs. 1 at Rs. 104.8 per kg and MCX lead was surging by 1.16% or Rs. 1.2 at Rs. 104.65 per kg.
Copper futures February 2012 contract in Shanghai settled at 54,840 yuan per tonne, up 930 yuan or 1.73% higher. Comex Copper futures most active December contract was trading at $3.363 a pound, up 2.84% or 9 cents compared to the previous day that ended at $3.27 a pound.
