Date : 05.03.2012
Copper Is Likely To Trade On Sideways During Morning
Session (MAR 05)
Copper is likely to
trade in sideways during the morning session on Monday, 5th March as the
expansion in China PMI might support the investors to trade in positive
territory. However, the ongoing developments in euro zone and release of Europe
PMI data might prompt the investors to trade cautiously during the day. Copper
is likely to find support at Rs 427 per kg and Rs 424.1 per kg and resistance
at Rs 435 per kg and Rs 439.6 per kg.
China's service sector
expanded at the fastest pace in four months in February. The seasonally
adjusted HSBC business activity index rose to a four-month high of 53.9 in
February from 52.5 in January.
China's official
Purchasing Managers Index for non-manufacturing sectors fell to 48.4 in
February from 52.9 in January as per the National Bureau of Statistics,
providing the central bank further reason to ease policy in an effort to
bolster economic growth.
Greece must complete a
bond exchange with private holders, scheduled to close on March 8th, before a
second bailout is paid.
Copper ended tad lower
on Friday, 2nd March ended the week on a weak note as the Spain breaching the
budgetary targets that has been promised at European leader's summit during
late February 2012 coupled with Moody's Investors Service downgrade of Greece's
local- and foreign-currency bond ratings to C from Ca dampened the sentiment.
Depreciation in Rupee favored copper at domestic bourses, MCX.
LME Copper edged down
by 0.2% at $8583.5 per tonne on Friday. Comex Copper dropped by 0.7% or 3 cents
at $3.903 a pound compared to $3.9315 a pound traded last day. MCX Copper
buoyed by 0.7% or Rs 0.16 at Rs 431.5 per kg. The contract stood above 9-day
EMA and RSI stood at 63.6.
The dollar index
surged near to the 2-week high by 0.8% at 79.42 against the basket of 6 major
currencies as the fall in euro tracing the developments in the Euro zone
prompted investors to flee away from risky assets and stay on safe haven
dollar.
Mariano Rajoy, prime
minister of Spain, lifted up the budget deficit to 5.8% of GDP in 2012 which is
more than 30% higher than the 4.4% target agreed by Brussels.
In industry news,
Alcoa has opened talks with some Indian companies to sell surplus alumina,
signaling the intention of the world's third largest aluminum producer to
increase presence in India. With an output of 16 million tonnes a year, Alcoa
is the world's largest alumina producer.
Alcoa is in talks with
Vedanta Aluminum and Hindalco Industries among other Indian companies. Alcoa is
not keen on building Greenfield smelter and refinery in India because of the
delays in getting government approvals and clearances. But it wants to expand
its presence in the country's mid to downstream markets, which make products
for construction, food processing and car wheels.
A stoppage at Freeport
McMoRan Copper & Gold Inc.'s Grasberg mine in Indonesia could be resolved
in this next week, with talks between workers and management progressing well.
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