Base metals prices on LME show positive trends; stocks witness outflows

• Optimism around Chinese stimulus boosts base metals prices
  
  
• Japanese household spending drops for 2nd straight month
  
  

Base metals prices on the London Metal Exchange (LME) threw up positive trends, except for lead, which witnessed a drop of 0.49%. Meanwhile, stocks at LME-registered warehouses showed negative movements, with aluminium declining 0.34%.

COMEX market update

Copper prices on the COMEX market increased by 4% to $9,726/tonne (t) compared to the previous close.

Indian market overview

In India's non-ferrous metals markets, BigMint assessed domestic copper armature scrap at INR 764,000/t ex-Delhi. Aluminium tense scrap prices remained stable, with ex-Delhi at INR 171,000/t and ex-Chennai at INR 172,000/t.

Global updates

Japanese household spending declines for 2nd month

Japanese household spending dropped 1.1% in September, marking a second consecutive decline m-o-m due to rising prices. This slowdown challenges the Bank of Japan's interest rate plans. Despite nominal wage increases, inflation-adjusted wages fell, prompting more saving over spending. The decline in consumption poses risks for economic growth, with GDP data due next week.

China stimulus speculation boosts base metal prices

Base metals prices are rising, fuelled by a weaker US dollar and speculation about China's economic stimulus. The greenback's decline has increased the appeal of dollar-denominated metals, while expectations of Chinese liquidity boosts and infrastructure spending are driving demand. Copper, aluminium, nickel, and zinc prices have all seen gains, particularly on the Shanghai Futures Exchange, as investors anticipate further growth.

Amara Raja to launch battery recycling plant by November-end

Amara Raja Energy and Mobility will begin operations at its new lead acid battery recycling plant in Tamil Nadu by the end of November. The facility, with an annual capacity of 150,000 t, aims to fulfil 25-30% of the company's raw materials needs. The plant is expected to reduce material costs and enhance supply chain resilience.

Oil prices fall

Oil prices edged lower as concerns over Hurricane Rafael's impact on US production eased. Market sentiment was mixed, with gains supported by expectations of tighter US sanctions on Iran and Venezuela. However, weaker Chinese crude imports and rising US inventories weighed on prices, dampening overall bullish sentiment.

Brent crude futures were recorded at $75.18/barrel. Meanwhile, WTI crude oil futures edged down by 0.70% d-o-d to $71.85/barrel.

Natural gas prices hold steady

Natural gas prices stood at $2.69/metric million British thermal unit (MMBtu), unchanged d-o-d.

Dollar index stable

The dollar index, which measures the value of the greenback against a basket of six major currencies, hovered at 104.37, stable d-o-d. The Indian rupee was recorded at INR 84.37 against the dollar.