MCX Lead managed to limit its loss just above half a percent in last week - Geojit Financial
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Lead prices remained under pressure on demand concerns and Chinese efforts to temper rising base metals prices.
Global Economy
* Global equities were largely on higher side last week, however China’s benchmarks SSE composite index closed lower.
* Organisation for Economic Co-operation and Development (OECD) raised global growth forecast by 5.8% this year and 4.4% next year.
* US Non-Farm payrolls added 559000, which was fall short of expectation gain in May .
* Chinese factory activity grew at a slower pace as raw material costs surge, however US manufacturing activity picked up in May on reopening economy
Currencies
* U.S. dollar closed on a flat note with a marginal gain of 0.12 % against the rival currencies after testing a three week in previous week.
* Euro and Chinese Yuan slipped lower against US dollar. while Japanese Yen managed to close on a positive territory against US dollar.
* Indian Rupee slipped as well in previous week and finally closed with loss by 0.63 percent and settled at 72.86 marks against dollar.
Lead
* LME lead futures skidded 2.62 percent, SHFE lead futures too lost momentum by 2.56 percent on previous week.
* MCX Lead managed to limit its loss just above half a percent in last week.
* Lead inventory levels in LME decreased by 2.70 percent, while stocks in SHFE increased by 12.88 percent.
* LME Cash over three month forward futures premium in Lead is contango at $19.50 per MT as on Friday.
Outlook
Chinese regulator action on surging base metals prices and concerns over demand likely to weigh the sentiment of lead. Meanwhile, recovering global industrial activities and a weak US currency continue to offer lower level support to prices.
LME: Inability to move past $2200 there are chances of corrective selling pressure. A direct rise above would take prices further higher.
MCX: Breaking the resistance of Rs 182 is needed to continue rallies. Else, corrective selloffs are likely in the counter.
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