Published on 8/01/2018 11:39:52 AM | Source: Angel Commodities Pvt Ltd

We expect Crude oil prices to trade higher today - Angel Commodities

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


Bullion

Gold

Last week, spot gold prices rose by around 1.3 percent while MCX gold prices rose marginally by 0.2 percent.

Persistent weakness in the dollar index despite strong economic data from the US boosted an upside.

Although the FOMC December policy meeting minutes fed the view among investors that more U.S. interest rate hikes are in store, still gold prices touched $1325.86/oz, highest since 15th Sep’17 during the week.

Also, an unexpectedly weaker nonfarm payrolls report in December after a robust ADP Non-Farm Employment Change added to the upside. US Nonfarm payrolls rose by 148,000 in December, well below expectations of 190,000.

Silver

Spot silver prices gained 1.6 percent to close at $17.2 per ounce in line with surge in gold prices and a weaker DX.

On the MCX, silver prices traded flat to close at Rs.39720 per kg.

Outlook

We expect gold prices to trade sideways today as global investors will await US inflation numbers for further cues on pace of future rate hikes.

On the MCX, gold prices are expected to trade sideways today, international markets are trading flat at $1320 per ounce.

Energy

Crude Oil

WTI and Brent oil prices traded higher by 1.7 and 1.1 percent respectively in the last week.

NYMEX oil prices touched $62.21/bbl on Thursday, highest since May 2015 before closing at $62 per barrel as EIA crude oil stocks reported a sharper drawdown of 7.4 million bbl against estimates for a decrease of 5.1 million barrels.

Besides, American Petroleum Institute (API) reported a drawdown of 4.992 million barrels of United States crude oil inventories for the week ending December 29, marking five large draws in as many weeks.

Already, prices gained support from anti-government protests in Iran, OPEC's third-largest producer, boosting supply disruption woes although the country's production and exports have not been affected yet.

On the MCX, oil prices rose 1 percent to close at Rs.3887 per barrel.

Outlook

We expect oil prices to trade higher today as unrest in Iran, consecutive inventory withdrawals in the US will be supportive.

On the MCX, oil prices are expected to trade higher today, although international markets are currently trading 0.3 percent higher at $61.3 a barrel.

Base Metals

Base metals started 2018 with a not so positive momentum ahead of FOMC meeting minutes release and mild selling pressure after a sharp rally in 2017.

MCX base metals traded mixed in line with international trends.

Copper

LME Copper prices fell by 1.7 percent while as investors booked profits after a sharp 30 percent rally last year.

However, Copper prices again touched $7285/t, highest since Jan’14 after a statement published on the Ministry of Environmental Protection's website showed China approved second batch of 2018 import quota for scrap copper worth 29,715 tonnes, after first batch of 110,770 tonnes last month. This is in line with industry association notice issued last year that China may ban imports of some scrap metal, including copper, from the end of 2018.

Alongside, supply disruption concerns given pending labour contract negotiations in 2018 including Escondida mine in Alongside, supply disruption concerns given pending labour contract negotiations in 2018 including Escondida mine in Chile, has already pushed the metal to $7312.5/t, levels last seen in January 2014.

MCX copper prices plunged by around 3 percent last week to close at Rs.452.5/kg hurt further by Rupee appreciation.

Outlook

LME Copper prices are currently trading higher by 0.3 percent at $7138.5/t. Copper prices are likely to trade higher today as reports of lower scrap imports by China will continue to be supportive.

MCX Copper prices will likely trade higher today.

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