Published on 20/03/2017 11:18:55 AM | Source: Angel Commodities Pvt Ltd

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

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


Bullion

Gold

Last week, Spot gold prices traded higher by 2 percent, to close at $1228.4/oz, while MCX gold prices rose by 0.5 percent at Rs.28509 per 10 gms.

The U.S. Federal Reserve called for gradual monetary tightening after raising interest rates by an expected 25 basis points for the second time in three months.

The central bank said in its policy statement that further hikes would only be "gradual," with officials sticking to their outlook for two more rate hikes this year and three more in 2018.

But political risks in Europe provided safe-haven support. Besides, bargain hunting at lower levels also acted as a positive factor.

 

Silver

Silver Spot silver prices rose by 1.7 percent last week to close at $17.3 per ounce. Rise in gold prices, and surge in the base metals acted as a supportive factor.

On the MCX, silver prices surged by 0.9 percent to close at Rs.40909 per kg.

 

Outlook

We expect gold prices to trade higher today as international markets are trading higher by 0.4 percent at $1226.7 per ounce after gaining for the past few days as although the US FED has done the rate hike for the second time, they said that further rate hikes will be gradual in nature.

On the MCX, gold prices are expected to trade higher today, in line with international trends.

 

Energy

Crude Oil

WTI oil prices rose 0.6 last week to close at $48.8 per barrel while MCX oil prices declined by 1 percent to close at Rs.3196 per barrel.

Crude oil stocks have witnessed gains for nine weeks in a row, to record high of 528 million barrels, thereby igniting concerns that the supply cut by OPEC will be overpowered by rising supplies from the US.

However, pricesclimbed for the first time in more than a week on a surprise drawdown in U.S. crude inventories and data from the International Energy Agency (IEA) suggesting OPEC cuts could create a crude deficit in the first half of 2017.

OPEC reported a rise in global crude stocks and a surprise output jump from its biggest member, Saudi Arabia, further pressuring prices that have now erased nearly all gains since OPEC announced output cuts in November.

Even though OPEC made an upward revision to its global demand outlook, signs of even modestly higher Saudi output flustered investors.

 

Outlook

We expect oil prices to trade lower today on account of high inventory and doubt over commitment by the OPEC members to extend its compliance on output cut.

On the MCX, oil prices are expected to trade lower today, international markets are trading lower by 0.84 percent at $48.37 per barrel.

 

Base Metals

LME base metals traded mostly higher last week as the Federal Reserve in its latest meeting expressed restraint over speeding up monetary tightening. Also, supply disruption concerns in some metals boosted an upside.

MCX base metals traded higher last week in line with international trends.

 

Copper

Last week, LME Copper prices surged 3.5 percent as strike at Cerro Verde, Peru's biggest copper mine, after a meeting between the union and management failed to resolve a dispute over labor demands, boosted supply disruption concerns in addition to strikes at Escondida in Chile and Grasberg in Indonesia.

Also, Chinese industrial production increased at a faster-thanexpected 6.3 percent pace in the first two months of the year, although retail sales surged lower than expected.

Further, weaker dollar after indications in the latest FOMC meeting there would be no pick-up in the pace of monetary tightening supported an upside.

MCX copper prices traded higher by 2.1 percent last week to close at Rs.390.8 per kg on Friday.

 

Outlook

LME Copper prices are trading lower currently by 0.7 percent currently at $5897/t. Risk appetite came under pressure after G20 leaders failed to agree on a commitment towards free global trade, giving way to protectionism concerns. Also, net longs in CFTC copper were trimmed for the forth week in a row, indicating falling investor interest. However, supply disruption concerns will continue to provide support.

We expect MCX copper prices to trade lower today in line with international trends.

 

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