Copper settled down -1.21% at 429.70 finished mostly lower despite stronger-than-expected growth in China in the June quarter, and higher-than-expected growth in China’s industrial production and fixed asset investment in June. China’s GDP grew by 2% (1.8% expected) in the June quarter, from an upwardly revised 1.5% in the March quarter, which left y/y GDP growth at 7.5% (7.4% expected), consistent with policy ‘fine-tuning’ during the quarter. Industrial production rose by 9.2% y/y (9% expected) in June, well above May’s 8.8% y/y growth. Official data released earlier showed that China’s economy expanded at an annual rate of 7.5% in the second quarter, above expectations for growth of 7.4%. A separate report showed that industrial production in China rose by an annualized rate of 9.2% in June, compared to expectations for a 9% increase, after an 8.8% gain in the previous month. The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption. Meanwhile, Federal Reserve Janet Yellen continues her testimony in front of U.S. lawmakers on Wednesday. Ms. Yellen said Tuesday that the U.S. economy is continuing to improve, but added that the recovery is not yet complete and reiterated that rates are likely to remain on hold for a considerable period after the bank’s quantitative easing program ends. The remarks came during testimony to the Senate Banking Committee in Washington. Technically market is under fresh selling as market has witnessed gain in open interest by 6.78% to settled at 10349 while prices down -5.25 rupee, now Copper is getting support at 427.1 and below same could see a test of 424.5 level, And resistance is now likely to be seen at 433.9, a move above could see prices testing 438.1.           

Trading Ideas:

Copper trading range for the day is 424.5-438.1.

Copper prices dropped as pressure seen despite upbeat economic performance indicators, but China’s growth was still dependent on investment, triggering market concerns.

US Fed’s Beige Book indicated the 12 Fed districts all reported increased growth in consumer expenditure and manufacturing expansion.

The Fed’s June policy meeting Minutes reveal that it has begun planning how to ease the US economy out of this accommodative policy era.