Nickel prices declined to Rs 1,166.30 per kg on October 29 as participants increased their short positions. The base metal pared earlier gains and entered into the negative zone tracking gains in the dollar.
Prices were weighed down by higher stocks at London Metal Exchange (LME) accredited warehouses. However, the downside may be capped amid expectations of robust demand from China’s stainless steel sector.
Nickel Asia Corp, the Philippines’ top producer and exporter of nickel ore, suspended operation at its mine due to the outbreak of coronavirus.
The commencement of rainy season in the Philippines' main nickel production may slow down shipments of ore after November.
The dollar trades firm at 93.86, or up 0.48 percent, in the evening session.
MCX iCOMDEX Base Metal Index was trading marginally flat at 12,341.19 at 20:19 hours.
In the futures market, nickel for November delivery touched an intraday high of Rs 1,188.50 and a low of Rs 1,151.30 per kg on the Multi-Commodity Exchange (MCX). So far in the current series, the base metal has touched a low of Rs 1,043.40 and a high of Rs 1,207.90.
Nickel futures for November delivery dropped Rs 8.2, or 0.7 percent, to Rs 1,166.30 per kg at 20:21 hours on a business turnover of 2,135 lots. The same for December delivery edged lower by Rs 8.20, or 0.7 percent, to Rs 1,169.6 per kg on a turnover of 29 lots.
The value of the November and December’s contracts traded so far is Rs 2,477.75 crore and Rs 10.70 crore, respectively.
"Nickel has formed a trend reversal pattern and price is expected to trade negatively. Sustaining below Rs 1,168 would drag prices lower towards Rs 1,155-1,150 levels intraday," according to Axis Securities.
At 14:55 (GMT), the base metal was trading down 1.07 percent at $15,560 per tonne in London.