MCX Copper will face a headwind in moving ahead as China PMI has declined to make things worse for the commodity used in construction. China logistics and information center said that the Purchase Manufacturing Index declined to an annual rate of 50.1 in February, down from 50.4 in January 2013.
LME Copper three months forward declined by $ 74 per tonne and reached the day's low of $ 7776 per tonne soon after the release of the report. Europe and US end products markets are still slow in consuming copper and that is impacting the manufacturing activity as most of the end products are exported from the country.
In India, the commodities transaction tax of 0.01% was imposed by the Finance Minister on non Agri products that will result in impacting the trading volume in the exchanges. This can act as a friction in today's trades of Copper. Meanwhile, third quarter GDP numbers of India were pretty miserable.
Quarterly estimates by the Central Statistical Office (CSO) showed that the growth rate of India has slipped down below 5% to 4.5% compared to corresponding quarter previous year. Biggest hit was taken by mining and quarrying sector that slipped to negative 1.4% in Q3 from 1.9% in Q2.
MCX Copper April expiry contract closed at Rs 431.5 per kg, up 0.8%. The prices tested a high of Rs 434 per kg and a low of Rs 428.8 per kg. The metal moved ahead even as its counterpart LME closed at $ 7850 per tonne, down $ 14 per tonne.
The fall in Indian Rupee was the main culprit behind the disparity of Indian and LME markets. The Rupee closed at 54.3 against the Dollar, down 0.8%. The Rupee has moved further down at 54.6 against the Dollar on Friday.
|Source by Commodity Insights|