Mixed Trend In Base Metals, Copper Gains On US Economic Data

On a weekly basis, the base metals complex delivered a mixed performance on the LME with aluminium, nickel and zinc ending in the red, and with copper and lead ending in the green territory. Mixed sentiments in the global markets exerted pressure on metal prices last week.

However, favorable economic data from the US coupled with easing concerns over euro zone debt worries after European leaders move forward to tackle the region’s debt crisis cushioned a sharp decline in the case of aluminium, nickel and zinc and supported upside in copper and lead prices last week.

Copper

Copper prices rose around 0.6 percent on the LME last week, on the back of weakness in the US Dollar Index, fall in weekly Shanghai inventories of copper and easing worries over euro zone debt concerns.

However, appreciation in the Indian currency led the red metal to witness a fall of around 0.2 percent on the MCX last week and touched a low of Rs. 428.60/kg.

Weekly copper inventories at warehouses monitored by the Shanghai Futures Exchange decreased sharply by 2.2 to 218,814 tonnes last week.

In contrast to this, the red metal inventories on the LME warehouses rose around 0.4 percent to 256,275 tonnes on 30th March 2012 from the previous level of 255,125 tonnes on 23rd March 2012.

Lead

On a WoW basis, lead prices rose sharply by 1.6 percent on the LME and around 2 percent on the MCX.

Weekly Shanghai inventories of lead dropped sharply by 18.6 percent to 26,880 tonnes last week which acted as a positive factor for the metal prices. Additionally, weakness in the US Dollar Index also provided further support.

Crude Oil Settles Lower On Rising US Inventories

On a weekly basis, Nymex crude oil prices declined by more than 3.5 percent taking cues from sharp increase in US crude oil inventories coupled with US-Euro approaching on a deal for the release of their strategic crude oil reserves.

However, a further downside in prices was restricted on account of additional sanctions on exports of Iranian crude oil coupled with a weaker dollar.

Oil prices touched a low of $102.13/bbl during the week and closed at $103.02/bbl on Friday. On the MCX, prices declined by 3.7 percent and closed at Rs. 5,301/bbl after touching a low of Rs. 5,260/bbl last week.

News

US President Barack Obama cleared the way for sanctions aimed at banks in countries that import Iranian crude oil. This is the latest step taken by the US government to exert pressure on Tehran over its nuclear program.

The US president stated the world crude oil supplies are sufficient in spite of sanctions on Iranian crude oil exports.

The US, Europe and Israel have accused Iran of seeking a capability to build a nuclear weapon which Iran says is solely for civilian energy and medical research.

China, India, South Korea, Turkey and other eight buyers of crude oil from Iran haven’t yet made pledge similar to nations like Japan and 10 European Union countries having detailed plans for curtailing imports of Iran’s crude oil.

Iraq’s Oil Minister Asim Jihad stated that Iraq’s crude oil exports rose to the highest level in March since 1980. The country exported as much as 71.827 million barrels or 2.317 million barrels a day in March which generated exports worth $8.475 billion at an average price of $118 per barrel.

Precious Metals Edge Higher On Depreciated US Dollar

Spot gold prices witnessed gains in the last week on the back of weakness in the US dollar coupled with easing concerns with respect to euro zone debt worries as the European leaders move forward to tackle the debt crisis.

European officials moved to increase their rescue funds, in order to protect Spain and Italy from the debt crisis. The yellow metal touched a high of $1696.20/oz and ended its trading session at $1668.29/oz last week.

On the MCX, Gold April contract traded slightly lower and touched a low of Rs. 27,903/10 gms during the week. The Indian Rupee appreciated around 0.7 percent last week and a stronger Rupee led decline on the domestic bourses.

Holdings in the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rise 0.3 percent to 1,286.62 tonnes by 30th March 2012 from the previous 1,282.69 tonnes on 23rd March 2012. On a year-to-date basis, gold holdings rose around 2.6 percent from the previous level of 1,254.57 tonnes on 31st December 2011.

Silver

Taking cues from rise in gold prices coupled with weakness in the US dollar index, spot silver rose around 0.1 percent in the last week. However, sharp gains were capped due to choppy sentiments in global markets coupled with mixed performance in base metals pack.

The white metal touched a high of $33.18/oz and ended its trading session at $32.22/oz last week. However, MCX Silver May contract decline around 0.5 percent on account of appreciation in the Indian rupee and ended its trading session at Rs. 56,909/kg last week.

Holdings in the iShares Silver Trust, the world's largest silver-backed exchange-traded fund, rose around 0.2 percent to 9734.55 tonnes on 30th March 2012 from the previous 9,716.42 tonnes on 23rd March 2012.