|
| Base metals may remain upbeat on Chinese demand |
| Dilip Kumar Jha / Mumbai Feb 08, 2009, 00:19 IST |
|
Base metals may rise up to 7 per cent in the short term on speculation that the stimulus packages proposed by the governments of the US and China will revive growth and boost demand for industrial commodities.
The hope revived towards the betterment of global economies with a number of Republicans favouring the fresh stimulus package of $900 billion as proposed by the US President Barack Obama. The US senate is likely to vote for the proposal this week.
China, the world’s largest copper user, has also started investing the second round of allocation of funds from its $535-billion stimulus plan. A BNP Paribas forecast states China’s economic plan will boost copper demand by 6.2 per cent this year, while US spending will increase the use of the red metal by 4.1 per cent.
According to Navneet Damani, a base metals analyst with AnandRathi, “Base metals will continue to remain upbeat on positive outlook for investment in infrastructure and consumer durables, the two major users of base metals.”
The weekly commodities outlook by Angel Broking finds the most active copper contract for delivery in February on the Multi-Commodity Exchange to get good support in the range of Rs 168-169 and strong support at Rs 163. The metal closed at Rs 172.85 per kg, a gain of over 12 per cent. On the London Metal Exchange, however, copper prices are likely to rise to $3,800 a tonne from the current level of $3,545.
Angel Broking believes that trading below Rs 163 would lead to lower prices, initially towards Rs 159 and then touch the Rs 151 level. Resistance is observed in the range of Rs 181-182, while strong resistance is seen at Rs 189. Trading above Rs 189 would lead to higher prices at Rs 199 and then to Rs 213 level.
Last week, LME copper jumped 14.32 per cent to $3,545, while aluminium perked up 8.53 per cent to end the week at $1,438. Zinc and lead closed with a marginal upward movement of 4.86 per cent and 3.52 per cent on the week at $1,165 and $1,177, respectively. Nickel, however, remained rangebound at $11,656.
The metal jumped 11 per cent last week to $1.6285 a pound on the New York Mercantile Exchange’s Comex division. Base metals climbed on speculation that manufacturing activities would resume post-slowdown.
On MCX, the near month February copper contract opened the week at Rs 157.05 initially moved lower but found good support at Rs 153.15 level. Later, prices recover sharply made a high of Rs 174.50 and finally ended the week with a huge profit.
Aluminium March 9 contract rose by 4.78 per cent to Rs 69.10 per kg, nickel March 9 contract by 0.96 per cent to Rs 565.40 per kg, zinc February 9 contract gained by 1.28 per cent to Rs 55.40 per kg and copper June 9 contract rose 2.77 per cent to Rs 168.70 per kg, while lead March 9 contract lost 1.91 per cent to Rs 56.60 per kg.
|
|
|
|
|
|
|
|
 Read Business news in |  |
|
|
|
|
|
|
Advertisements |
|
|
|
|
|
|
|
|
|
Content Guide
