By Amrita Mashar
MCX Copper February contract opened slightly down by 0.10% and made an intra-day low of Rs.439.45 after yesterdays sharp fall in prices.
Copper was dragged lower by a slight rise in dollar but further falls were kept in check by better economic growth prospects in China.
Copper prices are expected to trade bearish for today with major resistance at Rs.442 and support at Rs.440. Further downside movement is expected if prices close below Rs.438 which on maturity may take prices down towards Rs.433. Sell on rise with stop loss of Rs.442 can be suggested for today’s trading session.
Market players were now looking ahead to a report on Q4 China GDP to be released on Friday, along with data on industrial production and retail sales.
Meanwhile, spending on China’s power grid, a major consumer of copper and aluminium, is forecast to rise at a faster pace in 2013. The State Grid Corporation of China has increased its 2020 target to 94,500km of UHV lines laid, compared with 78,000km in the previous target, an increase of 21%, Barclays said in a report.
If realised, this projection of faster grid spending should help boost copper and aluminium demand, as UHV lines use copper-clad aluminium cables.
Last week, the China Securities Journal reported that the State Grid has set its 2013 spending target 4% higher y/y, after lukewarm growth in 2012 of 1.3%.
On India‘s MCX, copper for delivery on February 28 was seen trading at Rs.439.35 a loss of 0.26% as of 02.36 PM IST. (Amrita Mashar is Research Analyst, Commodity Online)
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