Base Metals Settle Lower On Rising Global Economic Concerns

Despite favorable economic data from the US, the base metals complex traded lower on the LME last week, as rising global economic concerns and weak sentiments in the markets exerted downside pressure on metal prices. Additionally, strength in the US dollar also acted as a negative factor.

However, depreciation in the Indian Rupee (INR) cushioned sharp decline on the domestic bourses in the last week. The INR depreciated around 0.5 percent last week and closed its trading session at the level of 49.75 on Friday.

Copper

Copper prices declined by more than 1 percent on the LME and around 0.9 percent on the MCX last week. Factor that affected the red metal prices are weak demand from China, the world’s largest metal consumer, a stronger dollar and mixed market sentiments.

However, sharp decline was cushioned on account of fall in the LME copper inventories.

On a weekly basis, copper inventories on the LME warehouses declined sharply by almost 4.5 percent to 276,025 tonnes on 9th March 2012 from the previous level of 289,000 tonnes on 2nd March 2012.

China copper imports increased by 17 percent in February According to the data from the General Administration of Customs, China's copper imports increased around 17.1 percent to 484,569 tonnes in February as compared to 413,964 tonnes in the prior month. Copper imports to China include refined, alloy, anode and semi-finished copper products.

Precious Metals Weigh Down On Firm Us Dollar Index

On a weekly basis, spot gold prices traded on a flat note taking cues from mixed market sentiments coupled with strength in the US dollar. The yellow metal touched a low of $1663/oz during the week and ended at the level of $1712.59/oz on Friday.

MCX Gold April contract rose slightly around 0.1 percent during the week on account of depreciation in the Indian Rupee. The yellow metal touched a high of Rs28,114/10 gms and closed at Rs27,995/10 gms on Friday.

Silver

Strength in the US dollar coupled with weak sentiments in the global markets led spot silver prices to trade lower by 1.6 percent in the last week. Silver being an industrial metal also took cues from downside in base metals pack. The white metal touched a low of $32.41/oz during the week and closed at the level of $34.18/oz on Friday.

On the MCX, Silver May contract rose around 2 percent in the last week due to a weaker Rupee and hit a high of Rs59,370/kg and closed at Rs.59,221/kg last week.

Crude Oil Edge Higher On Positive Us Economic Data

On a weekly basis, Nymex crude oil prices increased by 0.7 percent, taking cues from positive economic data from the US coupled with less than expected rise in US crude oil inventories.

However, sharp gains was restricted on account of a stronger dollar along with easing supply concerns from Iran as European Union’s has accepted Iran’s offer to resume talks on its nuclear program.

Crude oil prices touched a high of $108.20/bbl during the week and closed at $107.40/bbl on Friday. On the MCX, crude oil prices increased around 1 percent last week on the back of a weaker Rupee and closed at Rs.5349/bbl on Friday.

Natural Gas

Nymex natural gas prices declined around 6 percent on a weekly basis, on the back of less than expected fall in US natural gas inventories coupled with a forecast of mild weather. Additionally, a stronger dollar also led to further downside pressure on prices of the commodity.

Prices touched a low of $2.235/ mmBtu during the week and closed at $2.318/mmBtu on Friday. On the MCX, gas prices declined sharply by 7.2 percent and closed at Rs.115.8/ mmBtu after touching a low of Rs.113.3/ mmBtu during the week.