Copper On MCX Settled Up 1.37%

Copper on MCX settled up 1.37% at 370.2 in response to a retreat in the U.S. dollar from its recent peaks and evidence of tightening supply. World Bureau of Metal Statistics (WBMS) reported Wednesday global copper supply was in 5,000 tonnes of deficit during January-April 2017, compared to 69,000 tonnes of deficit in 2016. Copper inventories slid in April, but increased 82,000 tonnes in late April from late December 2016.

Output from global copper mines totaled 6.55 million tonnes during January-April 2017, down 0.6% from the same period of last year. Global copper cathode production was 7.67 million tonnes during January-April 2017, down 0.6% from the same period of last year. Peru’s copper production increased 1.6% on a yearly basis in April to 190,903 tonnes.

Higher output at MMG’s Las Bambas mine and Chalco’s Toromocho mine offset output declines from the strike at Cerro Verde. Peru’s copper output will continue growing during May-June since the strike has ended. Boston Fed President Eric Rosengren said low interest rates do pose financial stability concerns that central bankers and the private sector must take seriously while Bill Dudley, head of the New York Federal Reserve, a day earlier, downplayed the recent slowdown in inflation, warning that halting rate increases at this point would be dangerous.

Technically market is under short covering as market has witnessed drop in open interest by -15.26% to settled at 13782 while prices up 5 rupees, now Copper is getting support at 364.7 and below same could see a test of 359.1 level, And resistance is now likely to be seen at 374, a move above could see prices testing 377.7.

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Suhani Verma

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