LME base metals prices edge higher

Prices of non-ferrous metals on the London Metal Exchange (LME) have moved up. Three-month aluminium futures gained marginally by 0.2% to settle at $2,182/t, nickel prices rose by 0.3% to $18,655/t, copper prices edged up by 0.03% to $7,972/t, zinc prices rose by 0.6% to $2,436/t, and lead prices gained by 1.1% to $2,101/t.

Metal stocks in LME-registered warehouses also increased except zinc. Notably, copper stocks increased by 6% to 191,675 t from 180,675 t.

LME zinc prices have declined around 18% this year, with only nickel performing badly. This decline is attributed to the market shifting from a supply deficit to growing surplus. The International Lead and Zinc Study Group (ILZSG) reversed its April assessment of a small deficit, now expecting a 248,000 t surplus this year and 367,000 t in 2024. This change is driven by weaker-than-expected demand, especially in Europe, and stronger production in China.

COMEX market

Copper prices on the Commodity Exchange (COMEX) rose marginally by 0.3% to reach $7,875/t from $7,853/t on the last trading day.

India's non-ferrous market

Aluminium

The aluminium alloy ingot market declined slightly due to subdued demand, improved raw material availability, and a substantial price reduction by major consumers. Prices currently range from INR 183,000-184,000/t exw-Delhi.

The aluminium scrap market was stable yesterday. Local demand is sluggish, and suppliers are monitoring market trends post price cuts by key players.

Copper

The copper market is experiencing a downturn during the festive season of Navratri and Diwali, intensifying selling pressure. MCX copper prices declined by 0.4%, and SteelMint reported a decline in armature scrap and secondary rod prices. Global copper inventories have risen slightly, but they have helped stabilise prices.

On the Shanghai Futures Exchange, copper prices increased, reflecting strong demand projections and supply concerns. The market awaits China's GDP data and hopes for full-year growth amidst a potential Q3 economic slowdown. Glencore's decision to close Australian copper operations has also raised supply concerns, while the discounts are being offered for imported material due to moderate demand.

Global updates

Australian employment rises

In September, Australian employment increased by 6,700, falling short of expectations. However, the jobless rate decreased to 3.6%. This may not immediately impact the Reserve Bank of Australia's interest rate hike decision but adds weight to next week's inflation report's importance. The Australian dollar dipped slightly, with markets pricing in a 25% chance of a rate increase in the coming month.

China's new home prices decline

China's new home prices dropped for the third consecutive month in September, dispelling hopes of a recovery during a peak home-buying season. The 0.2% m-o-m decline in new home prices represents a slight improvement from August's 0.3% drop. Despite government stimulus measures, the property market remains in a slump.

South Korean interest rates steady

South Korea's central bank held interest rates steady today, maintaining a tightening tendency in monetary policy while warning of inflationary concerns from the Israel-Hamas conflict and global oil prices. The Bank of Korea (BOK) stated that pricing pressures will endure and that consumer inflation would take longer to attain its target level than previously anticipated.

Alcoa's alumina production rises 10%

Alcoa's alumina production surged 10% to 2.8 mnt driven by increased output at the Alumar refinery in Brazil and higher production from Australian refineries. Alcoa produced 532,000 t metric tons, a sequential increase of 2%.

Oil prices dip

Crude oil prices declined today, undoing the previous day's gains. This drop followed OPEC's lack of support for Iran's request to impose an oil embargo on Israel. Additionally, the US intends to ease sanctions on Venezuela, enabling increased global oil supply.

Brent oil futures went down by 0.33% to $91.20 per barrel. Crude oil WTI futures inched down by 0.01% to $88.31 per barrel, at the time of reporting.

Natural gas prices rise

Prices of natural gas were recorded at $3.076/MMBtu, up by 0.65% at the time of publishing this report.

Dollar index

Today, the US dollar remained strong compared to other currencies. This was in anticipation of statements from the Federal Reserve Chair leading to increased expectations that the central bank will maintain higher interest rates for an extended period.

The dollar index, which gauges the value of the greenback in a basket of six different currencies, hovered at 106.6, witnessing a slight rise of 0.04%, at the time of reporting.

The rupee was recorded at 83.26 against the dollar, remained largely stable against the previous closing.