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Metals Today: Base Metals Steady on Positive Global Growth Forecast

8 Apr 2021 8:05 am
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Mumbai (Commodities Control) - Base metals are showcasing a steady trend in early Asian trading hours on Thursday following projection of stronger global economic growth.

The dollar index, which measures the strength of the greenback against six major currencies, is trading at two-week low of 92.43.

Federal Reserve policy makers signalled the central bank will go on supporting the economy with asset purchases to safeguard the recovery, strengthening the outlook for energy consumption.

Price Action

Metal

LME Cash ($/MT)

Change

LME 3M ($/MT)

Change

SHFE (CNY/MT)

Change

Aluminium

2240.3

-0.41%

2260.0

-0.35%

17465

-0.43%

Copper

8919.0

-1.49%

8915.5

-1.45%

66880

-0.31%

Lead

1971.7

1.32%

1993.5

1.35%

14845

-0.44%

Nickel

16588.5

-0.61%

16636.0

-0.62%

125350

-0.25%

Zinc

2812.0

0.22%

2832.5

0.30%

21830

0.21%

Copper

Copper on London Metal Exchange fell from a two-week high on signs of adequate supply and concerns over the outlook for demand in China.

Copper inventories as LME monitored warehouses climbed the most in a week and are at the highest since November.

Chinese government messaging on the need to avoid asset bubbles is tempering investor enthusiasm for raw materials despite a broadly positive economic outlook.

With the coronavirus largely contained and the economy rebounding, Chinese policy makers have renewed a campaign to curb risks, especially in the financial and real estate sectors.

LME 3-M copper is trading at $8925 per ton while SHFE near-month contract is trading at CNY 66260 per ton.

LME copper inventories increased by 6900 tons to 150325 tons on Wednesday.

MCX copper for April expiry is forecast trade in the range of Rs. 680 – Rs. 700 per kg.

Lead

LME 3-M lead contract is trading near one-week high as positive global economic growth projection is supporting the battery metal.

The tepid consumption situation of both supply and demand in the spot market continued with the downstream buyers are not willing to purchase at low prices with only a small amount of stockpiling at low prices in the southeast region.

The outlook for the lead is grim in the near term as the rising coronavirus cases are denting demand for the battery metal.

LME 3-M lead forward contract is trading at $1980 a ton while first month SHFE lead is trading at CNY 14905 per ton.

LME lead inventories fell by 100 tons to 118900 tons on Wednesday.

MCX lead is projected to trade in the range of Rs. 160 – Rs. 170 per kg.

Zinc

The positive trend in the galvanizing metal is extending for the third consecutive trading session amid weaker dollar and strong economic growth projection.

Zinc prices increased amid falling US dollar and US Treasury yields, and the International Monetary Fund on Tuesday raised its 2021 growth outlook for the global economy to 6%, up from January’s forecast of 5.5%, which boosted bullish sentiment.

LME 3-M zinc forward contract is trading at $2836 a ton while first month SHFE lead is trading at CNY 21885 per ton.

LME zinc inventories fell by 1000 tons to 267650 tons on Wednesday.

MCX zinc is projected to trade positive towards Rs. 235 per kg.

Nickel

Nickel is steady in early Asian trading hours on LME and SHFE on robust demand from China following stronger than expected economic recovery.

Federal Reserve policy makers signalled the central bank will go on supporting the economy with asset purchases to safeguard the recovery, strengthening the outlook for nickel consumption.

Speedy recovery of the global economy backed by stimulus and vaccine is creating more demand for the nickel.

LME nickel trading at $16702 per ton while SHFE near-month contract is trading at CNY 125500 per ton.

LME nickel inventories fell by 786 tons to 258612 tons on Wednesday.

MCX nickel is forecast to show a positive trend and April futures are expected to move towards Rs.1270 per kg.

Aluminium

Aluminium is showcasing a range-bound trend on Thursday in absence of fresh triggers from the supply demand dynamics.

Market participants are assessing progress of Chinese aluminium consumption as it is pushing for cleaner energy consumption.

LME 3-M aluminium forward contract is trading at $2259 a ton while first month SHFE lead is trading at CNY 17485 per ton.

LME aluminium inventories fell by 22150 tons to 1860125 tons on Wednesday.

MCX aluminium is projected to move higher towards Rs. 190 per kg.



       
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