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Published on 25/03/2019 10:50:25 AM | Source: Angel Commodities Pvt Ltd

Crude oil prices are expected to trade lower today - Angel Commodities

Posted in Commodities Reports| #Commodity Tips #MCX #Angel Broking Pvt Ltd

 

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Bullion

Gold

Last week, spot gold prices rose by 0.8 percent after downfall in the US Dollar over dovish comments by the FED. However, better than expected U.S. economic data helped Dollar rebound which in turn capped gains for the yellow metal.

The U.S. Federal Reserve gave up all plans to hike interest rates in 2019, signalling towards an end of their monetary tightening policy which weighed on the Dollar in turn supporting Gold.

However, the gains were capped by the uptrend in the U.S. Dollar after applications for unemployment benefits reduced significantly last week coupled with factory activity in the mid-Atlantic region rebounding sharply this month after sharp falls.

 

Silver

Last week, Spot silver prices traded higher by 1.26 percent to close at $15.4 per ounce.

On the MCX, silver prices rose by 0.98 percent to close at Rs.38461.0 per kg during the similar time frame.

 

Outlook

Expectation of dovish stance by FED might weigh on the US Dollar and in turn support Gold. Markets will have an eye on results of the U.S. Federal Reserve's policy meeting later in the day.

On the MCX, gold prices are expected to trade higher today; international markets are trading higher by 0.20 percent at $1321.45 per ounce.

 

Energy

Crude Oil

WTI Crude continued its uptrend last week as well as prices went up by 1.8 percent. Production cuts by OPEC and its allies coupled with U.S. sanctions on OPEC members (Iran and Venezuela). OPEC and its allies cancel their planned meeting in April 2019 shaving off the chances of changes in the production cuts and hold the next regular talks on June 25-26, 2019.

A sharp downfall in inventories comes as many refineries are undergoing seasonal maintenance work ahead of peak summer demand has led to falling stock levels. Even lower production by U.S. has led to tightening of the inventory which has further supported prices.

However, the gains were capped as the trade tension between US and China raised demand concerns for Crude as China is the biggest crude consumer

 

Outlook

Supply cuts by OPEC and its allies might continue to support crude but fresh concerns over US-China trade relations might weigh on Crude.

On the MCX, oil prices are expected to trade lower today, international markets are trading marginally lower by 0.91 percent at $58.5 per barrel.

 

Base Metals

Last week, base metal prices on the LME were mixed. LME Zinc rose by 1.6 percent, the most amongst the pack. LME zinc inventories have declined over 1.18 million tonnes from its 2012 peak nearing the 58,000 tonnes mark recorded in October 2007. Massive fall in inventory levels pushed the Zinc prices higher.

After declining over dovish comments by the FED the U.S. Dollar rebounded after positive US economic data which weighed on the base metal prices. Appreciation in the U.S. Dollar made base metal expensive for other currency holders which restricted the gains is base metals.

Base metals were further pressurized as Donald Trump stated that the U.S. might levy tariffs on Chinese goods for a “substantial period” to ensure that China complies with any trade agreement. U.S. trade officials will visit China in March end for the next round of Trade talks.

As per the INSG, global nickel market deficit increased to 1,000 tonnes in January 2019 from a revised deficit of 100 tonnes in December 2018.

 

Copper

Last week, Copper price declined by 0.00 percent. Concerns over USChina trade relations coupled increase in output by China weighed on the prices. China's refined copper output in the first two months of 2019 rose by 6.3 percent yoy to 1.34 million tonnes.

 

Outlook

LME Copper price are currently trading lower by 0.12 percent at $6318.25 per tonne. Concerns over a possible trade deal between US and China might weigh on the red metal prices.

On the MCX, copper prices are expected to trade higher today.

 

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