IRIS reported that Broking firm Kotak Commodity Services gave following outlook on base metals segment:

1. Copper - MCX Copper may note some decline tracking cues from international exchange. LME Copper trades little changed above USD 7,300 per tonne level. Weighing on price are demand concerns amid uncertainty about major global economies. Mixed US economic data has kept concerns high about US economy while market players remain uncertain that EU summit this week will result in a major breakthrough. Indicating demand concerns, Australia`s Bureau of Resources and Energy Economics in a report said that copper may drop 11% this year amid weaker outlook for China and lower demand from Europe.

Also weighing on copper price are raising stocks on exchange warehouses. Stocks at LME rose by 50 tonnes after 3525 tonnes gain last week while those at SHFE rose by 6941 tonnes. Prices will further track economic releases and its impact on movement in global currency and equity markets. As for today, focus will be on US durable goods and pending home sales and development in the Euro zone. Support for June copper is seen at INR 412 while Resistance is seen at INR 422.

2. Aluminium - MCX Aluminium may trade with a downward bias tracking cues from international exchange. LME Aluminium trades marginally lower weighed down by demand concerns on back of uncertainty about global economy. Also weighing on aluminium price are lower energy costs and rising supply glut. Prices may however seek support from falling stocks at exchange warehouses. Stocks at LME fell by 1,725 tonnes while cancel warrants ratio continue to hover around 36.5% signaling demand in physical markets. Trend in copper will continue to be key price determining factor for aluminium. Support for Aluminium June contract is seen at INR 101.5 while resistance of INR 105.

3. Zinc - MCX Zinc may trade with a downward bias tracking cues from international exchange. Demand uncertainty amid weakening outlook for major global economies is weighing on industrial metals at large. Also weighing on zinc price are higher stocks at LME coupled with higher surplus in physical markets. Stocks at LME rose by 1050 tonnes hitting fresh 17 year high. Also according to the latest monthly bulletin from Lisbon based International Lead and Zinc Study Group, the global zinc market was in surplus by 121,000 tonnes in the first 4 months of the year. Zinc may continue to move in sync with other metals and focus on macro economic picture. Support for MCX Zinc June contract is seen at INR 100.5 while resistance is seen at INR 103.5.

Lead - MCX Lead may trade with a downward bias tracking cues from international exchange. LME lead price inched up after sharp decline however weighing on price are demand concerns amid weakening outlook for major economies. Also weighing on price are raising stocks at LME and higher surplus in physical markets. Also according to the latest monthly bulletin from ILZSG the global lead market was in surplus by 22,000 tonnes in the first four months of the year. Support for MCX Lead June contract is seen at INR 99.5 while resistance is seen at INR 103.5.

Source - IRIS

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