Copper On MCX Settled Up 0.32%

Copper on MCX settled up 0.32% at 403.75 on continued fund buying after prices seen pressure as data showed falling Chinese imports of the metal. Customs data showed China imported 189,812 tons of refined copper in October, down 45% year on year and the lowest monthly level since April 2013. 

A run of positive Chinese economic data and optimism about infrastructure spending in the U.S. following the election of Donald Trump have fueled optimism about demand for industrial metals. The metal is headed for the biggest monthly gain in a decade as investors flock back to commodities even as some banks warn the rally has gone too far.

At a time when money managers have never been so bullish on copper, there are other signs that prices have jumped too fast. U.S. durable goods data showed a 4.8% jump, the highest in a year, stoking further expectations of higher demand for the metal. The Shanghai Futures Exchange has already raised margins and trading limits on base metal futures contracts in a bid to rein in the exuberance of speculative traders. The Chinese are buying up copper as a hedge against yuan depreciation, data indicates that supply growth will remain high.

The global copper market has recorded a surplus of 124,000 tonnes during January to September this year. It must be noted that the worldwide copper market had reported a surplus of 302,000 tonnes for the entire year 2015. The global mine production during the period from January to September 255this year totaled 15.15 million tonnes. Technically now Copper is getting support at 399.8 and below same could see a test of 395.8 level, And resistance is now likely to be seen at 406.2, a move above could see prices testing 408.6.

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Suhani Verma

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