IRIS reported that Broking firm Kotak Commodity Services gave following outlook on base metals segment:
Copper - MCX Copper may note some decline tracking slight retreat in international market however the bias remains positive. LME Copper is trading slightly lower as markets turn cautious ahead of US Federal Reserve’s policy decision. Also putting pressure on the prices is sluggish demand from China and choppiness in equities. The downside may however be capped amid hopes of further stimulus by central banks of US and China to spur economic growth in their region.
Further lending support to the prices is easing worries over debt crisis in Euro Zone after German court yesterday ratified Euro Zone bailout fund albeit with conditions. Also lending support to the prices is weakness in US Dollar and falling stocks at exchange warehouses. Stocks at LME rose by 1,175 tonnes after declining by 13,950 tonnes last week. Prices may further track economic data releases and its impact on movement in global equity and currency markets. As for today focus will be on US Initial Jobless claims, FOMC meeting interest rate decision and economic projection. Support for November copper is seen at INR 448 while resistance is seen at INR 458.
Aluminum - MCX Aluminum may note some decline tracking international exchange however the downside remains capped. Lending support to the prices is recent decline in stocks at LME warehouses coupled with higher energy prices. Stocks at LME fell by 8,500 tonnes yesterday. Also lending support to the prices is news of production cuts. Russia’s United Company RUSAL Plc the world’s largest aluminum producer said it would cut capacity by 3% by the year end, as it grapples with weak prices and rising power costs. Support for Aluminum September contract is seen at INR 112.5 while resistance of INR 115.5.
Zinc - MCX Zinc may note some decline tracking international exchange however the downside remains capped. Prices may come under pressure tracking higher surplus however falling stocks at LME warehouses coupled with reduced production from top producer China may cap the downside. Stocks at LME fell by 3,050 tonnes after declining by 8,900 tonnes last week. Support for MCX Zinc September contract is seen at INR 109 while resistance is seen at INR 112.
Nickel - MCX Nickel may open higher tracking range bound movement in international exchange and weakness in Indian Rupee. Prices may seek support from weakness in US Dollar. However the gains may be capped tracking weak global demand and higher stocks at LME warehouses. Stocks rose by 6 tonnes after gaining by 2,172 tonnes last week. Also according to the latest monthly bulletin from Lisbon based International Nickel Study Group the global nickel market was in supply surplus of 34,800 tonnes in the first 6 months of 2012. Support for MCX Nickel September contract is seen at INR 910 while resistance is seen at INR 940.
Lead - MCX Lead may open higher tracking range bound movement in international exchange and weakness in Indian Rupee. Prices may continue to seek support from falling stocks at exchange warehouses coupled with robust demand from China however higher surplus in physical markets may cap the upside. Stocks at LME fell by 2,250 tonnes after declining by 6775 tonnes last week. Support for MCX Lead September contract is seen at INR 115.5 while resistance is seen at INR 118.5.
Source - IRIS.com
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