Industrial and Base Metals Fundamental Analysis – August 24, 2015 – Forecast – Copper, Palladium & More

Analysis and Recommendations:

Copper dipped 17 points to trade at 2.303 after Chinese PMI data missed expectations sinking farther into contraction. Palladium got hit hard dropping $16.75 to trade at 606.50. he preliminary Purchasing Managers’ Index from Caixin Media and Markit Economics was at 47.1 for August, compared with a median estimate of 48.2. Numbers below 50 indicate contraction. The data is the first major indicator for August and follows weaker-than-expected data on investment, industrial output, retail sales and exports in July.

Weaker data out of China adds to evidence of a deeper slowdown in the world’s biggest consumer of raw materials. Thirteen of 20 traders and analysts surveyed by Bloomberg this week were bearish on copper.

“The news out of China is not getting better, and it’s sending shockwaves through markets,” Robin Bhar, an analyst at Societe Generale SA in London, said by phone. “There are fears of depressed demand widening metal-market surpluses or erasing deficits, and therefore prices staying lower for longer.”

Traders said sentiments in copper weakened after it declined in global market as a Chinese manufacturing gauge fell to the lowest in more than six years, underscoring the threat to metals demand in the world’s biggest consumer.  Meanwhile, copper fell 1.8 per cent.

FxEmpire provides in-depth analysis for each currency and commodity we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more recent analysis and information in our weekly reports.

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Monday, August 24, 2015