LME base metals prices see positive trends; zinc gains over 4% amid reduced output
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Base metals prices on the London Metal Exchange (LME) witnessed uptrend, with the highest rise seen in zinc prices. Similarly, metal stocks at LME registered warehouses saw mixed movements.
Zinc prices surged on a weakening US dollar post-softer US inflation data, possibly prompting earlier Fed interest rate cuts, boosting commodity demand. Despite China's PMI signalling manufacturing contraction, reduced refined zinc output and global surplus drop hint at market balance improvement, supporting prices.
COMEX market
Copper prices on the Commodity Exchange (COMEX) gained 1% to $10,009/t against the previous closing.
India's non-ferrous market
BigMint's latest assessment noted a slight decline in spot prices for aluminium ADC12 alloy ingots in Delhi NCR to INR 215,000/t, alongside a drop in tense scrap prices to INR 185,000/t ex-Delhi. Chennai saw similar trends with tense scrap at INR 186,000/t and ADC12 at INR 216,000-217,000/t. LME aluminium prices fell 4% w-o-w. Market slowdown was attributed to major auto companies' maintenance. US tense scrap prices were down by $50/t to $1,920/t, while taint tabor prices at $2,025/t post-correction.
Global updates
Nickel industry turmoil in New Caledonia
New Caledonia's nickel processing industry faces turmoil, with riots disrupting operations. Eramet's SLN operates at minimum capacity, while Prony Resources halted production. The crisis, sparked by electoral reform, exacerbates financial woes for major producers. French government negotiations for sector rescue stalled amidst focus on restoring order.
Fed delays rate cuts amid stability
The Federal Reserve opted to maintain interest rates, delaying potential rate cuts until December amid stable economic conditions. Fed Chair Jerome Powell highlighted the need for clearer signals of economic shifts before adjusting policy. Despite modest inflation progress, policymakers remained cautious.
Currencies strengthen, Yen waits BOJ
Major currencies strengthened against a weakened dollar post-US inflation data, except the yen, as markets awaited Bank of Japan's decision. Euro surged above $1.0804, Aussie dollar rose, while yen dipped. Despite Fed's hawkish stance, markets anticipate rate cuts. BOJ's policy meeting outcome awaited, leaving yen vulnerable.
Pakistan's ambitious fiscal plan
Pakistan's ambitious budget for the upcoming fiscal year aims for a challenging tax revenue target of 13 trillion rupees, a 40% increase. With objectives to reduce fiscal deficit and boost growth, the budget faces inflationary concerns. Privatisation proceeds are modest, while coalition politics add complexities to reform efforts.
Oil prices dip
Oil prices dropped early Thursday as investors processed the likelihood that the U.S. Federal Reserve postponed a potential interest rate reduction to December. Additionally, substantial U.S. crude and fuel inventories exerted downward pressure on the market.
Brent oil futures were down slightly by 0.28% to $82.37 per barrel. Crude oil WTI futures edged down by 0.27% to $78.29 per barrel at the time of reporting.
Natural gas prices down
Prices of natural gas were recorded at $3.021/MMBtu, down 0.79%.
Dollar index
The dollar index, which gauges the value of the greenback in a basket of six different currencies, hovered at 104.81, slightly up by 0.16%.
The rupee was recorded at INR 83.54 against the dollar, depreciating marginally against the previous closing.
