Copper futures rise 0.86% Rs 536.40 per kg on hopes of further stimulus, softer US dollar

Copper prices climbed to Rs 536.40 per kg on October 21 as participants increased their long position as seen by the open interest. The base metal gained on optimism over further stimulus from the US and a softer dollar.

Copper prices gained today with Shanghai contract hitting its highest in a month on supply disruption in top producer Chile and jump in China’s import.

The US dollar trades lower at 92.75, or down 0.31 percent, lowest since September 7.

"Copper surged to its highest price in more than two years in London, helped by a rally in the yuan and concerns over risks of widening supply disruptions. MCX copper also hovering around an all-time high. The copper market is already tight, with mine output expected to drop for a second consecutive year in 2020, the International Copper Study Group said Monday. We believe the sentiment is likely to be positive in the red metal," said Jigar Trivedi, Research Analyst- Commodities Fundamental, Anand Rathi Shares & Stock Brokers.

MCX iCOMDEX Base Metal Index was up 87.24 points, or 0.71 percent, at 12,303.95 at 19:02.

In the futures market, copper for October delivery touched an intraday high of Rs 538.50 and a low of Rs 532.35 per kg on the MCX. So far in the current series, the precious metal has touched a low of Rs 494.80 and a high of Rs 538.50.

Copper delivery for October gained Rs 4.60, or 0.86 percent, to Rs 536.40 per kg at 19:09 hours with a business turnover of 4,063 lots. The same for November contract rose Rs 3.75, or 0.70 percent, to Rs 537.90 per kg with a turnover of 2,082 lots.

The value of October and November’s contracts traded so far is Rs 1,310.68 crore and Rs 123.33 crore, respectively.

“LME Copper has given a breakout above its 52 week high of $6,878 and sustaining above the level could indicate a positive momentum in the counter which could push prices to $7,000 levels. Support is at $6,890-$6,866 levels,” said Neha Qureshi, Technical Research Analyst at Reliance Securities.

MCX Copper October has given a breakout of its range-bound move above Rs 530 levels with an increase in volume activity where it can see upside rally up to Rs 537-542 levels heading towards 52-week high, which is placed at Rs 546 levels. Support is at Rs 533-528 levels. Copper could trade sideways to marginal upside momentum, she said.

At 1343 (GMT), the red metal price was up 1.08 percent quoting at $6,979.75 per tonne in London.