Base metals futures bounced on LME on Thursday, tracking extended gains in equity markets, following upbeat U.S. housing data that offered signs of stabilization in the beaten down sector. Base metals on MCX could not rise in line with the surge on LME as the rupee rose against the dollar and capped the upside.

Lead and Aluminium were clearly the leaders for the day rising by over 2 percent each on LME. Zinc declined the most, shedding 0.8 percent on MCX.

IN FOCUS:

Japan's output of rolled copper product fell to 56,775 tonnes in June on a seasonally adjust basis, down 29.6 percent from a year earlier, preliminary data showed on Friday. The figure represents a 17.6 percent increase from May, the Japan Copper and Brass Association said.

German zinc products producer Rheinzink is maintaining high output levels at its 100,000 tonne zinc rolling mill in central Germany despite the economic slowdown, its CEO was quoted as saying on Thursday.

Inventories of Aluminium fell 1,825 tonnes but hovered just below a record high closing on 4.6 million tonnes. Canceled warrants on aluminum rose to 181,250 tonnes from 171,900 tonnes.

FUNDAMENTAL OUTLOOK:

Base metals surged due to better than expected housing numbers. Downside will be capped as optimism in financial market and better than expected numbers are supporting base metals prices. Aluminium looks the strongest in the complex.