Below is Daily Commodity Article by Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities, and Currencies, Angel One Ltd
Gold prices extend the losing momentum, as the yellow metal slipped 0.68 percent lower and ended at 1737.8$ per ounce.
On Monday, as the dollar soared, gold prices decreased nearly 1% as investors opted for the safe haven's rival.
The dollar appreciated, making gold more expensive for holders of other currencies amidst fresh COVID-19 curbs in China that fuelled worries over the global economic outlook.
The US Federal Reserve is anticipated to announce a 50-basis point rate hike at its meeting in December, soas attention is now turning to the minutes from its most recent meeting for guidance on further increases.
Outlook: As the US Fed is anticipated to raise interest rates by 50 basis points at its forthcoming meeting, gold prices are anticipated to be under pressure.
Crude prices continue to take beating, as benchmark crude indices on Monday witnessed a sharp fall. Brent cracked over 6 percent and NYMEX slipped nearly half a percent.
Oil prices were hit by an abrupt reversal of sentiment as Saudi Arabia dismissed a media story that it was contemplating an increase in oil supply with OPEC and its allies.
However, prices swiftly recovered after the Saudi energy minister announced that the country is staying with output reductions and has not brought up the possibility of increasing oil production with other OPEC oil producers.
As the government battles outbreaks that are approaching April peaks in China, COVID-19 infections in China limited market advances.
Outlook: We expect crude to trade higher towards 6730 levels, break of which could prompt the price to move higher to 6840 levels.
The base metals pack on Monday ended on a lower note, as all the metals ended on a negative note, with MCX Nickel being the top loser.
However, new COVID restraints in top user China, a stronger dollar, and swelling stockpiles in warehouses registered with the LME were the factors that caused copper prices to fall to their lowest point.
While local authorities in the southern Chinese city of Guangzhou closed off the area for five days, the capital city of China recorded a spike in COVID-19 cases.
Industrial metal prices have generally been impacted by the stronger US currency, which makes goods with dollar prices more expensive for people using other currencies.
Outlook: We expect copper to trade lower towards 661 levels, break of which could prompt the price to move lower to 651 levels.
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