Copper prices experienced a modest increase, closing up 1.01% at Rs 1,150.4, as market participants drew some optimism from the prospect of alleviating geopolitical tensions. Sentiment showed signs of improvement following Donald Trump’s extension of the deadline for potential action against Iran, thereby providing additional time for negotiations. Although this offered temporary respite, the overall perspective continues to be ambiguous, as indications of potential further U.S. troop deployments sustain risk premiums.

Despite the modest rebound, copper has encountered pressure in recent weeks as a result of increasing energy costs and apprehensions that extended conflict may hinder global industrial activity. On the supply side, inventories at the Shanghai Futures Exchange have decreased by 12.6% over the past week, suggesting a contraction in near-term availability. However, this was counterbalanced by a significant increase in LME warehouse stocks, which have risen to an eight-year peak, up 153% since the beginning of the year.

Demand trends seem to exhibit a degree of variability. Although previous price declines prompted a degree of restocking in China, the prevailing sentiment continues to be one of caution. Import data indicated a 16.1% year-on-year decrease in unwrought copper imports, despite an uptick in concentrate imports. Market forecasts are diverging, indicative of the prevailing uncertainty surrounding the macroeconomic environment.

From a technical perspective, the market is experiencing short covering, as open interest has decreased by 4.2% to 9,314 lots while prices increased by Rs 11.5. Immediate support is identified at Rs 1,142, with a breach below possibly challenging Rs 1,133.5. Resistance is established at Rs 1,159, and a breach of this threshold may propel prices toward Rs 1,167.5.