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Gold

Gold yesterday settled up by 0.14% at 49380 but ended with losses knocked by a stronger dollar and expectations of a sizeable U.S. rate hike. Solid US retail sales and jobless claims data, along with a surprisingly hot CPI report, cemented fears that the Fed may need to move even more aggressively to arrest surging prices. Gold also lost its shine as a safer-haven asset in times of heightened economic uncertainties, with the World Bank and IMF slashing growth forecasts for key economies, while major US companies issued weak guidance on dire economic outlooks. Markets now see a 75% chance of a 75-basis-point rate hike at the end of the Federal Reserve's meeting next week and a 25% chance of a 100-bps increase. Physical gold demand picked up in India as domestic prices fell ahead of key festivals, while premiums in China climbed further as its currency weakened. Dealers in India charged premiums of up to $3 an ounce over official domestic prices, up from last week's $1 premium. Jewellers were making decent purchases for the upcoming festive season because of price correction. In top consumer China, premiums climbed to $20-$25 an ounce over international benchmark spot prices in thin trading with some regions facing COVID curbs, compared with $16-$25 last week. Technically market is under short covering as the market has witnessed a drop in open interest by -8.23% to settle at 9395 while prices are up 68 rupees, now Gold is getting support at 49052 and below same could see a test of 48725 levels, and resistance is now likely to be seen at 49605, a move above could see prices testing 49831.

Trading Ideas:
* Gold trading range for the day is 48725-49831.
* Gold recovered from lows but ended with losses knocked by a stronger dollar and expectations of a sizeable U.S. rate hike.
* Solid US retail sales and jobless claims data, cemented fears that the Fed may need to move even more aggressively.
* Markets now see a 75% chance of a 75-basis-point rate hike at the end of Fed’s meeting next week and a 25% chance of a 100-bps increase


Silver

Silver yesterday settled up by 0.54% at 56720 tracking recovery in copper prices after prices seen pressure post the U.S. CPI shocker that dashed the hopes of a softening in the Fed's monetary policy. The Dollar's strength, in the backdrop of changed expectations on Fed Policy as well as the hardening of bond yields have been dragging prices. The retail sales numbers only reinforced the belief that the Fed would do all it can to control inflation, deepening the bearish sentiment on the precious metal. The University of Michigan consumer sentiment for the US increased to a five-month high of 59.5 in September of 2022 from 58.2 in August, compared to market forecasts of 60, preliminary estimates showed. With continued declines in energy prices, the median expected year-ahead inflation rate declined to 4.6%, the lowest reading since last September, from 4.8% in August. At 2.8%, median long run inflation expectations fell below the 2.9-3.1% range for the first time since July 2021. The Central Bank of Russia slashed its key interest rate by 50bps to 7.5% during its September 2022 meeting, as expected. It was the sixth consecutive rate cut as current consumer price growth rates remain low. Still, inflation expectations of households and price expectations of businesses remain elevated. Technically market is under short covering as the market has witnessed a drop in open interest by -5.99% to settle at 17752 while prices are up 303 rupees, now Silver is getting support at 55700 and below same could see a test of 54681 levels, and resistance is now likely to be seen at 57369, a move above could see prices testing 58019.

Trading Ideas:
* Silver trading range for the day is 54681-58019.
* Silver gained tracking recovery in copper prices after prices seen pressure on fears of harsher Fed policy
* The retail sales numbers only reinforced the belief that the Fed would do all it can to control inflation
* The World Bank and IMF slashing growth forecasts for key economies, while major US companies issued weak guidance on dire economic outlooks.

Crude oil

Crude oil yesterday settled down by -0.18% at 6810 on fears of hefty interest rate increases that are expected to curb global economic growth and demand for fuel. Investors are bracing for an increase to U.S. interest rates, with the market also rattled by the International Energy Agency's outlook for almost zero growth in oil demand in the fourth quarter owing to a weaker demand outlook in China. On the supply side, the market has found some support on dwindling expectations of a return of Iranian crude as Western officials play down prospects of reviving a nuclear accord with Tehran. Oil prices could also be supported in the fourth quarter by possible OPEC+ production cuts, which will be under discussion at the group's October meeting, while Europe faces an energy crisis driven by uncertainty on oil and gas supply from Russia. Oil output in the Permian in Texas and New Mexico, the biggest U.S. shale oil basin, is due to rise 66,000 barrels per day (bpd) to a record 5.413 million bpd in October, the U.S. Energy Information Administration (EIA) said in its productivity report. Total output in the major U.S. shale oil basins will rise 132,000 bpd to 9.115 million bpd in October, the highest since March 2020, the EIA projected. Technically market is under fresh selling as the market has witnessed a gain in open interest by 3.25% to settle at 5788 while prices are down -12 rupees, now Crude oil is getting support at 6729 and below same could see a test of 6647 levels, and resistance is now likely to be seen at 6894, a move above could see prices testing 6977.

Trading Ideas:
* Crude oil trading range for the day is 6647-6977.
* Crude oil dropped on fears of hefty interest rate increases that are expected to curb global economic growth.
* On the supply side, the market has found some support on dwindling expectations of a return of Iranian crude
* Oil prices could also be supported in the fourth quarter by possible OPEC+ production cuts

Nat.Gas

Nat.Gas yesterday settled down by -6.57% at 630.9 with output holding near a monthly record and as global gas prices eased. That U.S. price decline came despite forecasts for warm weather to remain through the end of September, which will force power generators to keep burning lots of gas to keep air conditioners humming. In addition to rising output, the drop in U.S. gas prices also came on expectations demand would decline when the Cove Point liquefied natural gas (LNG) plant in Maryland shuts for a couple weeks of maintenance in October. U.S. gas demand has already been reduced for months by the ongoing outage at the Freeport LNG export plant in Texas which has left more gas in the United States for utilities to inject into stockpiles for next winter. Freeport, the second-biggest U.S. LNG export plant, was consuming about 2 billion cubic feet per day (bcfd) of gas before it shut on June 8. Freeport LNG expects the facility to return to at least partial service in early to mid-November. Data provider Refinitiv said average gas output in the U.S. Lower 48 states rose to 99.0 bcfd so far in September from a record 98.0 bcfd in August. Technically market is under fresh selling as the market has witnessed a gain in open interest by 45.45% to settle at 5757 while prices are down -44.4 rupees, now Natural gas is getting support at 615.8 and below same could see a test of 600.7 levels, and resistance is now likely to be seen at 656, a move above could see prices testing 681.1.

Trading Ideas:
* Natural gas trading range for the day is 600.7-681.1.
*Natural gas fell with output holding near a monthly record and as global gas prices eased.
* The drop also came on expectations demand would decline when the Cove Point LNG plant in Maryland shuts for a couple weeks
* Downside seen limited amid forecasts for warm weather to remain through the end of September


Copper

Copper yesterday settled up by 0.88% at 651.3 as some support seen after China's factory output grew faster than predicted and LME copper inventories kept falling, and are currently around 100,000 mt. The LME copper cash-to-three-month backwardation hit a new high since the end of November last year, reflecting tight supply in the spot market. Potential supply disruptions have also worried the market after news that workers at Chile's Escondida copper mine, the world's largest copper mine, threatened to strike due to safety concerns. In China, copper smelters in some regions have returned to normal operating levels after the power rationing was lifted, but those in Jiangxi and Inner Mongolia are still disturbed by the pandemic. However, upside seen limited as investors worried about slowing economic growth and China's yuan continued to weaken. The yuan has fallen by about 4% against the dollar in the past month and slipped past the psychologically important level of 7 yuan to the dollar for the first time in two years. Visible copper inventories in China are very low, but Yangshan copper import premiums have fallen to $93 a tonne from $112.50 last month, suggesting weaker demand for overseas metal. Copper inventories in warehouses monitored by the Shanghai Futures Exchange fell 1.4 % from last Friday, the exchange said. Technically market is under short covering as the market has witnessed a drop in open interest by -11.08% to settle at 5184 while prices are up 5.7 rupees, now Copper is getting support at 640.6 and below same could see a test of 629.7 levels, and resistance is now likely to be seen at 657.2, a move above could see prices testing 662.9.

Trading Ideas:
* Copper trading range for the day is 629.7-662.9.
* Copper prices gained as some support seen after China's factory output grew faster than predicted and LME copper inventories kept falling
* Copper inventories in warehouses monitored by the Shanghai Futures Exchange fell 1.4 % from last Friday, the exchange said.
* Yangshan copper import premiums have fallen to $93 a tonne from $112.50 last month, suggesting weaker demand for overseas metal.

Zinc

Zinc yesterday settled down by -0.56% at 281.8 as investors braced for a U.S. rate hike amid growing concerns of a global recession following warnings from the World Bank and the International Monetary Fund. The global economic outlook remains downbeat and some countries are expected to slip into recession in 2023, but it is too early to say if there will be a widespread global recession, the IMF said. The IMF in July revised down global growth to 3.2% in 2022 and 2.9% in 2023. In comparison, the World Bank said the world could be edging towards a global recession in 2023 as central banks across the world simultaneously hike interest rates to combat persistent inflation. China's retail trade rose by 5.4% year-on-year in August 2022, exceeding market estimates of 3.5% and accelerating from a 2.7% growth a month earlier. This was the third straight month of increase in retail trade and the strongest pace in the sequence, as consumption strengthened following further relaxation in COVID curbs. China's industrial production increased by 4.2% yoy in August 2022, beating market consensus of 3.8% and after a 3.8% rise in July. It was the fourth straight month of growth in industrial output, and the fastest pace since March, suggesting the economic recovery was able to sustain momentum. Technically market is under long liquidation as the market has witnessed a drop in open interest by -4.06% to settle at 1393 while prices are down -1.6 rupees, now Zinc is getting support at 276.6 and below same could see a test of 271.4 levels, and resistance is now likely to be seen at 284.9, a move above could see prices testing 288.

Trading Ideas:
* Zinc trading range for the day is 271.4-288.
* Zinc dropped as investors braced for a U.S. rate hike amid growing concerns of a global recession following warnings from the World Bank and IMF.
* China retail sales rise the most in 3 months
* China factory output growth at 5-month high


Aluminium

Aluminium yesterday settled down by -1.24% at 199.1 as China's aluminium output climbed to a second straight monthly record in August at 3.51 million tonnes, up 9.6% from the same month a year earlier, as new production capacity came on line, more than offsetting curbs on power use in some areas. August's production rose 2.3% from 3.43 million tonnes in the prior month, according to data released by the National Bureau of Statistics, extending recent robust growth compared with last year when some key smelting hubs grappled with restrictions on metal production as well as power usage. In the first eight months of the year, China produced 26.47 million tonnes aluminium, a rise of 2.1 % from the same period last year, the data showed. Output from regions like Guizhou and Inner Mongolia has risen with newly added capacity, enough to more than offset production headwinds in other regions that implemented power rationing in factories following tight electricity supply. Futures exchange operator CME Group Inc said average daily volumes in aluminium futures have surged 359% in the third quarter to date from the first quarter, hitting a single-day record of 6,709 contracts on Sept. 14. Prices were also pressured by gloomy demand outlook against the backdrop of the U.S. Federal Reserve's likely aggressive interest rate hikes and a firm dollar. Technically market is under fresh selling as the market has witnessed a gain in open interest by 5.71% to settle at 4481 while prices are down -2.5 rupees, now Aluminium is getting support at 197.1 and below same could see a test of 195 levels, and resistance is now likely to be seen at 201, a move above could see prices testing 202.8.

Trading Ideas:
* Aluminium trading range for the day is 195-202.8.
* Aluminum dropped as China aluminium production up 9.6 % to 3.51 mln tonnes in August
* Prices were also pressured by gloomy demand outlook against the backdrop of Fed likely aggressive interest rate hikes and a firm dollar.
* CME says aluminium futures average daily volumes have surged in Q3


Mentha oil

Mentha oil yesterday settled up by 1.99% at 982.6 amid low production this season and improving demand post-pandemic. However, upside seen limited as Synthetic Mentha supply remains uninterrupted. Many states have seen gutkha and pan masala ban which have seen a lower demand from the pan masala industry. The production of Mentha oil was historically high in 2020-21, the area remained almost similar last year but the yields were lower which affected the production. In the current year we forecast production to fall to around 46,238 MT due to sharp fall in area and loss in yields following severe summer heat. which will come closed 14% down in the year 20-21. Mentha exports during Apr-July 2022 has dropped by 19.63 percent at 648.49 tonnes as compared to 806.87 tonnes exported during Apr-July 2021. In the month of July 2022 around 155.04 tonnes Mentha was exported as against 113.33 tonnes in June 2022 showing a rise of 36.80. In the month of July 2022 around 155.04 tonnes of Mentha was exported as against 283.33 tonnes in July 2021 showing a decline of over 45.28%. In the month of June 2022 around 113.33 tonnes Mentha was exported as against 209.90 tonnes in May 2022 showing a drop of 46%. In Spot market, support seen after IMD issues Yellow Alert in key sowing area ; light-moderate rain to continue till Sept 4 impacting arrival in the mandi. In Sambhal spot market, Mentha oil dropped by -21.7 Rupees to end at 1114.5 Rupees per 360 kgs.Technically market is under short covering as the market has witnessed a drop in open interest by -10.76% to settle at 1095 while prices are up 19.2 rupees, now Mentha oil is getting support at 969.7 and below same could see a test of 956.7 levels, and resistance is now likely to be seen at 991.2, a move above could see prices testing 999.7.

Trading Ideas:
* Mentha oil trading range for the day is 956.7-999.7.
* In Sambhal spot market, Mentha oil dropped  by -21.7 Rupees to end at 1114.5 Rupees per 360 kgs.
* Mentha oil gains amid low production this season and improving demand post-pandemic.
* However, upside seen limited as Synthetic Mentha supply remains uninterrupted.
* In the month of July 2022 around 155.04 tonnes Mentha was exported as against 113.33 tonnes in June 2022 showing a rise of 36.80.

Turmeric

Turmeric yesterday settled down by -1.52% at 7256 on profit booking as sowing activities has almost completed in major growing states across India and Crop size is expected to be on par. The Product Advisory Committee (PAC) on turmeric has rejected calls for banning futures trade in the commodity, claiming that it has not found any unusual movement in its price. As per Andhra Pradesh agricultural department, sowing activity completed around 7,958 hectares as compared to last year same period 7,764 hectares. Sufficient stocks and good sowing reports kept turmeric prices under pressure. Turmeric exports during Apr-July 2022 has rose by 17.72 percent at 62,245.73 tonnes as compared to 52,875.44 tonnes exported during Apr-July 2021. In the month of July 2022 around 12,810.36 tonnes turmeric was exported as against 18,532.00 tonnes in June 2022 showing a drop of 30.87%. In the month of July 2022 around 12,810.36 tonnes of turmeric was exported as against 12,826.38 tonnes in July 2021 showing a decrease of 0.12%. In the month of June 2022 around 17,532.00 tonnes of turmeric was exported as against 13,206 tonnes in June 2021 showing an increase of 40.33%. Production of spices in India is likely to have declined 1.5% on year to 10.9 mln tn in 2021-22 (Jul-Jun), according to data from Spices Board India. The country had produced 11.0 mln tn of spices in the previous year. The Spices Board has pegged turmeric production at 1.33 mln tn, up 18.4% on year. In Nizamabad, a major spot market in AP, the price ended at 7406.6 Rupees gained 25.7 Rupees.Technically market is under long liquidation as the market has witnessed a drop in open interest by -0.42% to settle at 13185 while prices are down -112 rupees, now Turmeric is getting support at 7150 and below same could see a test of 7046 levels, and resistance is now likely to be seen at 7414, a move above could see prices testing 7574.

Trading Ideas:
* Turmeric trading range for the day is 7046-7574.
* Turmeric dropped on profit booking as sowing activities has almost completed and Crop size is expected to be on par.
* In the ongoing season, no major quality concerns were observed in the crop arrived in the Marathwada region.
* In the month of July 2022 around 12,810.36 tonnes turmeric was exported as against 18,532.00 tonnes in June 2022 showing a drop of 30.87%.
* In Nizamabad, a major spot market in AP, the price ended at 7406.6 Rupees gained 25.7 Rupees.

Jeera

Jeera yesterday settled down by -1.35% at 25200 on profit booking after prices seen supported as supply was observed to be less as farmers and stockists were holding stocks in expectations of higher prices in coming months. Arrivals also observed to be less during the month. Mandi arrivals of Jeera, at all-India level decreased by 10% as compared with previous month supported by decrease in arrivals in Rajasthan as well as in Gujarat. Jeera exports during Apr-July 2022 has dropped by 37.28 percent at 67,057.16 tonnes as compared to 1,06 ,929.72 tonnes exported during Apr-July 2021. In the month of July 2022 around 19,866.18 tonnes jeera was exported as against 21,587.63 tonnes in June 2022 showing a drop of 7.97%. In the month of July 2022 around 19,866.18 tonnes of jeera was exported as against 24,167.64 tonnes in June 2021 showing a decrease of 17.80%. In the month of June 2022 around 21,587.63 tonnes of jeera was exported as against 30,989.86 tonnes in June 2021 showing a decrease of 30.34%. Production of spices in India is likely to have declined 1.5% on year to 10.9 mln tn in 2021-22 (Jul-Jun), according to data from Spices Board India. The country had produced 11.0 mln tn of spices in the previous year. Jeera production was seen at 725,651 tn, down 8.8% on year due to lower acreage in Rajasthan and Gujarat, the key producer, according to data from Spices Board India. According to fourth advanced estimates by Gujarat government, jeera production is seen fall by 44.5 per cent to 221500 tonnes in 2021-22 on yoy basis In Unjha, a key spot market in Gujarat, jeera edged down by -182.35 Rupees to end at 24728.95 Rupees per 100 kg.Technically market is under long liquidation as the market has witnessed a drop in open interest by -2.96% to settle at 8445 while prices are down -345 rupees, now Jeera is getting support at 24980 and below same could see a test of 24760 levels, and resistance is now likely to be seen at 25490, a move above could see prices testing 25780.

Trading Ideas:
* Jeera trading range for the day is 24760-25780.
* Jeera dropped on profit booking after prices seen supported as supply was observed to be less as farmers and stockists were holding stocks
* Mandi arrivals of Jeera, at all-India level decreased by 10% as compared with previous month
* All-India Jeera production is expected to fall in the Marketing year 2022-23 by around 33% to 3 lakh tonnes on y-o-y basis due to lower sowings.
* In Unjha, a key spot market in Gujarat, jeera edged down by -182.35 Rupees to end at 24728.95 Rupees per 100 kg.

Cotton

Cotton yesterday settled down by -3.99% at 33420 as India’s Cotton sowing gained by nearly 7.54% to 127.15 lakh hectares in 2022 against an area sown of 118.24 lakh hectares in 2021. Cotton crops, remain under threat due to adverse weather conditions and pest attacks in major growing regions. India’s cotton output for the season 2022-23 is likely to touch 375 lakh bales (each of 170 kg), given no climatic adversities affect the crop during October, sources said. India’s Cotton sowing gained by nearly 7.34% to 126.66 lakh hectares in 2022 against an area sown of 118 lakh hectares in 2021.Atul Ganatra, President, Cotton Association of India (CAI), stated that the cotton crop condition in India was "very good and if everything goes well, we are expecting 350 lakh bales +/– 25 lakh bales." In its monthly supply-demand report, the 2022/23 U.S. cotton projections include higher beginning stocks, production, exports and ending stocks this month, the USDA's report said. Additionally, the 2022/23 world cotton projections include higher production and ending stocks relative to last month, and lower consumption. In recent time, the heavy rainfalls and pest attacks are affecting the cotton crop. In the northern states of Punjab, Haryana, and Rajasthan cotton crop has been affected due to pink bollworm infestation. In spot market, Cotton gained by 210 Rupees to end at 40310 Rupees.Technically market is under long liquidation as the market has witnessed a drop in open interest by -1.29% to settle at 766 while prices are down -1390 rupees, now Cotton is getting support at 33050 and below same could see a test of 32680 levels, and resistance is now likely to be seen at 34160, a move above could see prices testing 34900.

Trading Ideas:
* Cotton trading range for the day is 32680-34900.
* Cotton dropped as India’s Cotton sowing gained by nearly 7.54% to 127.15 lakh hectares in 2022.
*U.S. export data showing solid sales of the natural fiber, with an elevated dollar preventing any large gains.
* Cotton area is estimated at 126 lakh hectares till September 2 — up 8-9 per cent from 117 lakh hectares last year.
* In spot market, Cotton gained  by 210 Rupees to end at 40310 Rupees.

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