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Worsening China factory slump weighs on Copper

By Religare
|

Copper futures were trading flat in late morning trade in the domestic market on Friday as investors and speculators remained wary of booking fresh positions in the industrial metal as a continued severe equity rout in China, with the country's benchmark index sliding more than 1 per cent today underlined concerns over a worsening slowdown in the world's second biggest economy, darkening the demand outlook for copper, given that China is the world's biggest consumer of the metal, making up about 40 per cent of global copper consumption.

 

Further, manufacturing activity in China contracted at the sharpest pace in more than six years last month, signaling a worsening economic gloom in the country. A private manufacturing index for China fell to 47.1 in August, from 47.8 in July, with a reading below 50 signaling contraction.

However, a spike in existing home sales in the US to the highest level since February 2007 in July signaled a strengthening housing recovery in the world's biggest economy, lifting the demand outlook for the industrial metal, supporting copper.

At the MCX, Copper futures for August 2015 contract is trading at Rs 336.05 per 1 kg, up by 0.01 percent after opening at Rs 335.70, against the previous closing price of Rs 336. It touched the intra-day high of Rs 337.15 (At 11:43 AM).

Story first published: Friday, August 21, 2015, 23:00 [IST]
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