Copper prices decreased by 0.43%, closing at Rs 1,276.75, as new demand worries associated with rising tensions between Iran and the US countered the support from tightening near-term supply indicators. The increase in geopolitical risks has bolstered the US dollar, while simultaneously heightening worries regarding global growth and industrial demand, thereby impacting sentiment in the base metals market. Nonetheless, the downside appeared constrained owing to ongoing speculative inflows into the metals sector and supply-side apprehensions, especially regarding the potential for sulphuric acid shortages should disruptions in the Strait of Hormuz continue.

Inventory trends exhibited a varied landscape. The Shanghai Futures Exchange has seen stocks decrease by more than 50% from their peaks in March, with an additional decline of 4.6% last week. This trend indicates a seasonal recovery in demand and restocking activities in anticipation of upcoming holidays in China. In contrast, LME inventories have more than doubled since January, while Comex stocks have surged significantly over the past year, indicating a robust global availability outside China.

The global copper market is fundamentally transitioning into a surplus environment. The International Copper Study Group has indicated a refined copper surplus of 276,000 metric tons for February, with projections showing a surplus of 96,000 metric tons in 2026, which is expected to increase in 2027. Revisions to demand growth expectations indicate a downward trend, especially in developed markets, whereas supply remains bolstered by increasing secondary production. Production data revealed a blend of trends, as declines in Chile were partially counterbalanced by increases in Peru and certain mining operations.

The market is currently experiencing new selling pressure, as indicated by a 2.19% increase in open interest to 12,364 lots, alongside a price decrease of Rs 5.45. Immediate support is identified at Rs 1,271.1, with potential further decline towards Rs 1,265.5. On the upside, resistance is positioned at Rs 1,284.2, and a sustained move above this level could drive prices toward Rs 1,291.7.