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Published on 19/06/2018 10:56:04 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

Bullion

Gold

Spot gold prices fell marginally while MCX gold prices fell 0.1 percent to close at Rs.30974 per 10 gms.

Gold prices fell as escalating trade tensions between the US and China boosted safe haven demand. Ongoing tensions between the US and China along with disappointing G7 meeting boosted safe haven appeal. Further, retaliatory warnings by EU, Canada and Mexico after the US imposed tariffs on Steel and Aluminium imports from these nations added to global uncertainty.

However, strong dollar at seven month highs as the Federal Reserve went ahead with 25 bps rate hike in its June’18 meeting and signalled two more increases by 2018 end, restricted sharp upside.

Silver

Spot silver prices fell 0.7 percent on Monday to close at $16.4 per ounce in line with decline in gold and base metal prices.

On the MCX, silver prices declined 0.5 percent to close at Rs.40716 per kg.

Outlook

Gold prices are likely to trade higher as tariff war between the US and China will boost safe haven demand.

On the MCX, gold prices are expected to trade higher today, international markets are trading higher by 0.4 percent at $1282.9 per ounce.

Energy

Crude Oil

WTI oil prices rose 1.2 percent while MCX oil prices gained 1 percent on Monday recovering from losses in the previous session.

Global investors are gauging the situation after President Donald Trump on Friday announced tariffs on $50 billion worth of Chinese imports, and Beijing retaliated by targeting high-value American exports.

Oil prices got a much need respite as comments from the Iraqi oil minister cast doubt on the Organization of the Petroleum Exporting Countries decision to boost output at its upcoming meeting.

The Organization of the Petroleum Exporting Countries released its monthly report on Tuesday, saying a high degree of uncertainty was hanging over the global oil market. OPEC holds its next meeting on June 22-23, and is expected to decide on future supply policy.

Also, latest report from the Energy Information Administration showed a large crude oil stocks drawdown of 4.1 million barrels for the week to June 8, after a 2.1-million-barrel increase a week earlier.

Outlook

Oil prices are likely to be under pressure as concerns that the OPEC and key ally Russia will gradually increase output after withholding supplies since 2017 will weigh on prices. The OPEC meeting scheduled on June 22-23 will be a close watch by investors across the globe while high degree of uncertainty might come as said in the OPEC report will disturb the sentiments of oil investors.

On the MCX, oil prices are expected to trade lower today in line with 0.7 percent weakness in NYMEX oil prices.

Base Metals

Base metals traded mostly lower on Monday as global risk aversion citing heightened trade war concerns coupled with stronger DX weighed on the counter.

MCX base metals traded lower in line with international markets.

Copper

LME Copper prices fell by 0.8 percent yesterday as US-China trade war concerns escalated with retaliation from China.

Tensions between the US and China touched a new peak on Friday after the US President announced a 25 percent tariff on $US50 billions of goods from China and warned of further levies in case of retaliation form the mainland nation. The first wave of tariffs to cover $34 billion of goods will take effect from July 6.

Despite the threat, Chinese government was quick to react and reciprocated with duties of same scale and intensity and due to take effect on the same date on 545 US products including soybeans, electric cars, orange juice, whiskey, salmon and cigars.

Not only this, Last week China’s industrial output, investment and retail sales all grew less than expected in May’18, raising doubts over demand prospects in the mainland nation.

MCX Copper prices fell by 1.1 percent to close at Rs.468.8/kg in line with international trends.

Outlook

LME Copper prices are trading lower by 0.4 percent at $6945/t. Copper prices are likely to trade lower as escalating tensions between the US and China, with the former announcing tariffs on the mainland and the latter planning for one, will weigh on prices. Also, easing supply woes at citing progress at Escondida mine will exert pressure.

MCX copper prices are expected to trade lower today in line with international markets.

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