Investors bet on base metals to rake in the moolah:

17th October, 2007:

NEW DELHI: Booming global metal markets have enthused the investors as they bet on base metals, hoping for a windfall, analysts on Wednesday said.

"We are expecting good returns from this sector," commodity brokerage firm Karvy Comtrade analyst Harish G said, adding most of the base metals, including copper, zinc and nickel have seen gains of more than 100 per cent in the past one-two years.

These metals have also seen increased participation of investors on the London Metal Exchange (LME) as well as on the Multi Commodity Exchange (MCX).

"It is a safe bet to invest in base metals as the market is moving firm. According to the current market movement, investors can easily earn good returns in copper, lead and nickel. However, one should be cautious while trading in zinc as prices seem to be a bit volatile," Religare Commodities analyst Suganda Sachdev said.

"The prices of nickel, zinc, lead and copper would remain high for some period. Demand from developing countries like China and India is driving the prices of base metals in the global market."

With China and India emerging as two of the fastest growing economies, the world is experiencing a massive build-out and modernisation of global infrastructure. China's demands for the base metals have been surging in view of the upcoming Olympics games for which it has undertaken to build massive physical infrastructure.

Even India's smelting capacity of refined copper has increased from a mere 0.5 per cent to 5 per cent of the global share. [From Internet]