Base Metals Preview: Copper Extends Gains On Supportive Economic Cues

Base Metals Preview: Copper Extends Gains On Supportive Economic Cues

Dec 02, 2020 08:12 IST capital market

COMEX Copper soared to fresh seven year high of $3.50 per pound on upbeat global manufacturing outlook yesterday. MCX Copper added 0.81% to close at Rs 587 per kg. The Institute for Supply Management or ISM said its US manufacturing PMI dropped to 57.5 in November from 59.3 in October, with a reading above 50 indicating growth in the manufacturing sector. Chinas manufacturing sector logged its strongest growth in a decade in November to indicate a sustained recovery from the Covid-19 outbreak, survey data from IHS Markit showed. The Caixin manufacturing PMI rose to 54.9 in November from 53.6 in October. This was the highest score since November 2010. Eurozone final factory PMI fell to 53.8 in November from 54.8 in October, data from IHS Markit showed Tuesday. Manufacturing sector expanded for the fifth successive month in November despite new lockdown measures.

On a broad note, global economic cues were supportive too as the Organization for Economic Cooperation and Development (OECD) said it expects the global economy to contract 4.2% this year. That reflects an upward revision from an estimate made in September that pointed to a 4.5% fall in real GDP. Looking ahead, the group said worldwide economic growth would average 4% over the next two years. It expects real GDP growth to hit 4.2% in 2021 — trimmed from a September forecast of 5% — and 3.7% in 2022.

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