Base Metals
India
The base metals pack witnessed phenomenal performance in the week gone by. Metals with weak fundamentals gained on the back of a major bout of technical buying and short-covering. We have noticed in the past few days that the six base metals have seen divided performance as three metals i.e., copper, aluminum and tin have strong fundamentals while zinc, lead and nickel have poor fundamentals.
However, last week’s gain in the complete base metals complex including zinc, lead and nickel indicated strong technical support. Fundamental factors like supply constraints and expected cut in production also added spice to the rally. However, the base metals closed off session highs on Friday on the back of profit-booking before the weekend. Copper’s upside is capped due to concerns over slowing demand in China. However, expected strikes in Peru is providing cushion to the downside in copper. The coming week could see heavy volatility as this technically led rally could be followed by heavy profit-booking as metals like zinc, lead and nickel do not have any strong fundamental backing.
Exerpted from www.Commodityonline.com (Compiled with inputs from Angel Commodities, Mumbai)