Nickel On MCX Settled Down -0.64%

Nickel on MCX settled down -0.64% at 589.40 after the news from the Philippines has eased worries about shortages of the metal used to make stainless steel, where production is slowing. Three-month nickel closed down one percent at $9,070 a tonne. Sentiments remain weak after the news that the flow of Indonesian nickel ore to China has resumed after a three-and-a-half year break.

There have been a few false alarms since the Indonesian government banned all exports of unprocessed minerals, including nickel, at the start of 2014. China's trade figures have shown the occasional import of what has been classified as nickel ore but which was in all probability iron ore with high nickel content. But May's 264,000 tonnes seem the real deal. Not only was it the largest monthly total in three years but it tallies with plans by Indonesia's Aneka Tambang (Antam) to make its first 150,000-tonne shipment at the start of the month.

It's still a fraction of what Indonesia used to send every month to China before 2014. The export ban remains in place but with a growing number of exemptions for companies that have committed to building processing plants. For the Chinese NPI producers that depend on such ore, it marks a dramatic turnaround from what looked like an existential crisis when Indonesia first cut off their supply.

Now Investors keeping track of economic data will closely monitor nonfarm payrolls on Friday. The monthly report is expected to show the creation of 180,000 jobs last month, which is a substantial improvement over the 138,000 increase reported in May. Technically market is getting support at 587.1 and below same could see a test of 584.8 level, And resistance is now likely to be seen at 592.8, a move above could see prices testing 596.2.

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Suhani Verma

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