Base metals prices on the London Metal Exchange (LME) saw significant increases following encouraging macroeconomic data from China, with all metals trading higher by the 5 pm closing on Wednesday, 3 March. Meanwhile, stocks at LME-registered warehouses witnessed varied trends.
Three-month aluminium futures inched up by 2% to $2,429/tonne (t), while nickel prices were at $17,339/t (up 1.8%). Copper prices settled at $9,262/t, while zinc edged up by 2.7% to $2,548/t. Lead prices were up by 3% to $2,082/t.
COMEX market
Copper prices on the Commodity Exchange (COMEX) stood largely stable against the previous closing.
India’s non-ferrous markets
ADC12 alloy ingot spot prices rose by INR 2,000/t to INR 213,000/t in Delhi. Offers in Delhi and Chennai are tense, while tradable levels in Chennai are lower. Aluminium casting scrap is being exported to Korea. ADC12 production is at 60-70% capacity due to price differences. Silicon prices showed significant decreases.
Global updates
Economic data spurs interest rate reassessment
Strong economic data and concerns about persistent inflation are prompting investors to rethink the extent of potential interest rate cuts by the Federal Reserve, leading to weakness in the U.S. government bond market. The yield on the 10-year treasury hit 4.429%, its highest level in over four months.
Hindustan Zinc: Record quarterly metal production in Q4 FY24
Hindustan Zinc achieved its highest-ever quarterly refined metal production in Q4 FY24 at 273,000 t, marking a 6% increase sequentially. Refined zinc production stood at 220 kt, up 9% q-o-q, while refined lead production was at 53,000 t, down 2% y-o-y. The company also recorded significant annual production milestones, including 1.07 mnt mined metal and 1.03 mnt refined metal.
Copper prices reach 14-month high on optimism, supply cuts
Copper prices surged to 14-month high in Asian trading on Thursday, driven by growing optimism about China’s economy and potential production cuts by major refiners. Positive Chinese PMI data fuelled sentiment, while reports of output cuts by Chinese smelters amid tight copper concentrate supply further supported prices, tightening global copper supplies amidst improving demand.
March sees slower U.S. services growth, favourable inflation outlook
U.S. services industry growth slowed in March, with the Institute for Supply Management’s PMI dropping to 51.4, indicating a moderate expansion. Prices paid for inputs hit a four-year low, suggesting a favourable inflation outlook. New orders declined, but production remained strong. Employment levels slightly improved, reflecting ongoing challenges in the labour market.
Oil prices range-bound
Brent oil futures were up slightly by 0.02% to $89.37 per barrel. Crude oil WTI futures edged down by 0.04% to $85.40 per barrel at the time of reporting.
Natural gas prices dip
Prices of natural gas were recorded at $1.842/MMBtu, up 0.05%.
Dollar index
The dollar index, which gauges the value of the greenback in a basket of six different currencies, hovered at 104.13, slightly down by 0.12%.
The Indian rupee is expected to marginally strengthen against the U.S. dollar over the next three months, supported by the Reserve Bank of India’s intervention and record-high foreign exchange reserves.
The rupee was recorded at INR 83.44 against the dollar, appreciating marginally against the previous closing.