MCX BASE METAL TIPS: Zinc futures slid by more than 3% in the domestic market on Thursday as investors and speculators exited positions in the industrial metal amidst subdued physical demand for zinc in the domestic spot market.
Stock market turmoil in China, the world’s largest metals consumer, threatened to signal deep-rooted problems in world’s second biggest economy, darkening the demand outlook for Zinc. The Chinese central bank lowered the value of the country’s currency by the most since March 2011, fueling fears over China’s economic health, and causing an exodus from equities worldwide with the Shanghai Composite falling over 7%, triggering an automatic circuit breaker, leading to a trading suspension for the second time this week. Investors fear that China’s move to weaken the Yuan may hurt Chinese metal demand as a weaker currency threatens to curb imports.
Traders cast aside data showing a surge in German factory orders in November, signaling a pickup in Europe’s biggest economy, buoying the demand outlook for base metals. Bookings for German factory goods climbed 1.5 per cent in November over the previous month.
At the MCX, Zinc futures for January 2016 contract closed at Rs 99.45 per kg, down by 3.45 per cent after opening at Rs 102.1, against the previous closing price of Rs 103. It touched the intra-day low of Rs 98.15.
Stock market turmoil in China, the world’s largest metals consumer, threatened to signal deep-rooted problems in world’s second biggest economy, darkening the demand outlook for Zinc. The Chinese central bank lowered the value of the country’s currency by the most since March 2011, fueling fears over China’s economic health, and causing an exodus from equities worldwide with the Shanghai Composite falling over 7%, triggering an automatic circuit breaker, leading to a trading suspension for the second time this week. Investors fear that China’s move to weaken the Yuan may hurt Chinese metal demand as a weaker currency threatens to curb imports.
Traders cast aside data showing a surge in German factory orders in November, signaling a pickup in Europe’s biggest economy, buoying the demand outlook for base metals. Bookings for German factory goods climbed 1.5 per cent in November over the previous month.
At the MCX, Zinc futures for January 2016 contract closed at Rs 99.45 per kg, down by 3.45 per cent after opening at Rs 102.1, against the previous closing price of Rs 103. It touched the intra-day low of Rs 98.15.
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