Base metals shine, crude oil remains firm

Base metals futures, including copper, nickel, lead and zinc on the MCX platform, showed remarkable recovery on the week ended on Friday, following firm overseas markets supported by buying support at lower levels. The star performers for the week were nickel, lead, and zinc and futures prices rose by about 4-6% over last week. On the other hand, copper was overall steady, as strike actions at Peruvians mined had ended and inventories at exchange warehouses continued to gain. Rising inventories in China had also pressurised copper prices to consolidate from recent highs. Copper inventories monitored by LME had gained by 4.8% to total 138,150 tonne.

The active November copper contract was up Rs 1.35 to trade at Rs 314.85 per kg. The Open Interest was 14,022 tonne. “MCX copper had breached 23.6% Fibonacci Retracement levels. It continues to correct further. Markets are likely to consolidate with a bearish bias and test Rs 308 levels,” an analyst with MAPE ADMISI said.

The active lead October contract was up 4.4% to trade at Rs 150.30 per kg. The Open Interest was 20,620 tonne. The active October zinc contract was also up nearly 4% to trade at Rs 122.40 per kg. Total Open Interest was 35,105 tonne. The active October nickel contract was up 6% to trade at Rs 1,268.10 per kg.

In London, gold improved marginally after the dollar continued to lose ground versus the euro. The active October gold contract was traded firm at Rs 9,570 per 10 gram due to the recent surge in crude oil prices. There was a temporary respite in the dollar’s fall, as the US Trade Deficit declined by nearly $2 billion. The active December silver contract was higher 2.5% to trade at Rs 18,298 per kg in line with yellow metal.

The active November crude oil contract was higher 2.54% to trade at Rs 3,227 per barrel on reports of an unexpected decline in US supplies. Crude oil October closed at $81.3 on NYMEX. A report says that global inventories fell in the third quarter. US inventories fell 1.67 million barrels last week, the Energy Department said on Thursday.