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Gold

Gold yesterday settled down by -0.3% at 50356 as the dollar and U.S. Treasury yields climbed after comments from Federal Reserve Chair Jerome Powell cemented expectation around a 75-basis-point rate hike at its upcoming policy meeting. The Fed is "strongly committed" to controlling inflation but there remains hope it can be done without the "very high social costs" involved in prior inflation fights, Powell said. Data showed the number of Americans filing new claims for unemployment benefits fell last week to a three-month low, underscoring the robustness of the labor market. Federal Reserve officials said they still aren't convinced the worst of the U.S. inflation scare has passed, in comments that teed up a continuation of the central bank's aggressive interest rate increases. "We are in this for as long as it takes to get inflation down," Fed Vice Chair Lael Brainard said in an address to a banking conference, echoing past comments by officials from other central banks to do "whatever it takes" to protect their economies. The chief risk now, Brainard and others said, remains the worst outbreak of inflation since the 1980s. The Fed has raised interest rates at its last four policy meetings by a total of 2.25 percentage points, and is expected to lift its policy rate by another 50 or 75 basis points at its Sept. 20-21 session. Technically market is under long liquidation as the market has witnessed a drop in open interest by -2.8% to settle at 10604 while prices are down -150 rupees, now Gold is getting support at 50123 and below same could see a test of 49891 levels, and resistance is now likely to be seen at 50665, a move above could see prices testing 50975.
 

Trading Ideas:
* Gold trading range for the day is 49891-50975.
* Gold prices slipped as the dollar and U.S. Treasury yields climbed
* ECB delivers 75 bps rate increase
* U.S. weekly jobless claims fall to 3-month low


Silver

Silver yesterday settled up by 0.47% at 54281 tracking rise in base metals and crude oil prices after pressure seen earlier dropped as the dollar approached 110, as Fed Chair reiterated that the central bank is strongly committed to bring inflation down, and that longer inflation remains above target which poses a great risk. Markets are currently betting on another 75bps rate hike when the Fed meets later in the month. At the same time, the US economy is seen in a better shape to handle a recession than other major economies. The dollar strengthened mostly against Euro as investors get more increasingly concerned about the outlook in the Euro Area, even after the ECB delivered a historic 75bps rate hike in its September 2022 meeting. The ECB increased policy rates by an unprecedented 75 bps and signaled further hikes ahead, which in turn, raised market bets on more tightening by the BoE. It comes after BoE Mann said that interest rates should be raised in a more aggressive pace as the central bank’s gradualist risks elevated inflation for a prolonged time. Meanwhile, the new Prime Minister Liz Truss announced that the government would cap domestic energy prices for households at £2,500 while limiting them for businesses to ease the ongoing cost-of-living crisis. Technically market is under short covering as the market has witnessed a drop in open interest by -0.02% to settle at 25954 while prices are up 254 rupees, now Silver is getting support at 53837 and below same could see a test of 53394 levels, and resistance is now likely to be seen at 54742, a move above could see prices testing 55204.
 

Trading Ideas:
* Silver trading range for the day is 53394-55204.
* Silver gained tracking rise in base metals and crude oil prices after pressure seen earlier dropped as the dollar approached 110
* ECB raised its key interest rate by an unprecedented 75 basis points and signalled further hikes, prioritising the fight against inflation.
* US economy is seen in a better shape to handle a recession than other major economies.


Crude oil

Crude oil yesterday settled up by 1.35% at 6699 as investors weighed on supply concerns against signs of a persistently sharper economic slowdown. Demand outlook remains a bearish weight on oil prices with the largest crude importer in the world, maintaining its zero-COVID lockdown policy that now has some 65 million people under a restricted movement regime. The API reported a build this week for crude oil of 3.645 million barrels, while market predicted a draw of 733,000 barrels. Britain's new Prime Minister Liz Truss will on Thursday scrap the country's fracking ban and will seek to make more use of North Sea reserves Weather watchers report little in the way of threats to the Gulf of Mexico. The next storm system that the NHC is watching is just west of the Cabo Verde islands but is only given a 60% chance of forming into a storm in the next five days by the storm-watch agency. Support seen after the news that plans by Russian President Vladimir Putin to halt the country’s oil and gas exports if price caps are imposed. Global oil demand growth will rise by an average of 2.1 million barrels per day for all of 2022 and by an average of 2 million bpd in 2023, the EIA said. Technically market is under short covering as the market has witnessed a drop in open interest by -14.06% to settle at 11878 while prices are up 89 rupees, now Crude oil is getting support at 6561 and below same could see a test of 6422 levels, and resistance is now likely to be seen at 6789, a move above could see prices testing 6878.
 

Trading Ideas:
* Crude oil trading range for the day is 6422-6878.
* Crude oil gains as investors weighed on supply concerns against signs of a persistently sharper economic slowdown.
* China’s weak economic data and stringent zero-COVID policy continued to add to demand concerns.
* The API reported a build this week for crude oil of 3.645 million barrels, while market predicted a draw of 733,000 barrels.


Nat.Gas

Nat.Gas yesterday settled up by 0.46% at 632.1 on an expected smaller-than- expected storage build last week and forecasts for higher gas demand over the next two weeks than previously expected. The U.S. Energy Information Administration (EIA) said utilities added 54 billion cubic feet (bcf) of gas to storage during the week ended Sept. 2. 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. U.S. natural gas production and demand will rise to record highs in 2022, the U.S. Energy Information Administration (EIA) said in its Short Term Energy Outlook (STEO). EIA projected dry gas production will rise to 97.09 billion cubic feet per day (bcfd) in 2022 and 100.36 bcfd in 2023 from a record 93.55 bcfd in 2021. The agency also projected gas consumption would rise from 82.97 in 2021 to 86.56 bcfd in 2022 before sliding to 84.63 bcfd in 2023. That compares with a record 85.29 bcfd in 2019. Despite the small increase, the front-month remained in technically oversold territory with a relative strength index (RSI) below 30 for a third consecutive day for the first time since early July. Technically market is under fresh buying as the market has witnessed a gain in open interest by 5.11% to settle at 5574 while prices are up 2.9 rupees, now Natural gas is getting support at 620.1 and below same could see a test of 608.2 levels, and resistance is now likely to be seen at 643.9, a move above could see prices testing 655.8.
 

Trading Ideas:
* Natural gas trading range for the day is 608.2-655.8.
* Natural gas edged up on an expected smaller-than- expected storage build last week and forecasts for higher gas demand
* The U.S. EIA said utilities added 54 billion cubic feet (bcf) of gas to storage during the week.
* U.S. natgas output and demand to hit record highs in 2022 – EIA



Copper

Copper yesterday settled up by 2.49% at 653.3 as potential disruptions in producing countries raised worries of shortage of supply for the metal. Workers at BHP's Escondida, the world's largest copper mine, threatened to go on strike over what they described as safety concerns, the mine's union said. In Indonesia, President Joko Widodo reiterated that the country will stop exporting raw copper, bauxite and tin to encourage foreign investment and help the country jump up the value chain in resource processing. Meanwhile, copper remains more than 30% below this year’s high as aggressive monetary tightening by major central banks and top metal consumer China’s Covid-19 curbs heightened the risk of a global economic slowdown. The global refined copper market showed a 66,000 tonne deficit in June, compared with a 30,000 tonne deficit in May, the International Copper Study Group (ICSG) said in its latest monthly bulletin. For the first 6 months of the year, the market was in a 72,000 tonne deficit compared with a 130,000 tonne deficit in the same period a year earlier, the ICSG said. World refined copper output in June was 2.17 million tonne, while consumption was 2.23 million tonne. Bonded stocks of copper in China showed a 66,000 tonne deficit in June compared with a 34,000 tonne deficit in May. Technically market is under short covering as the market has witnessed a drop in open interest by -8.32% to settle at 5433 while prices are up 15.85 rupees, now Copper is getting support at 644.6 and below same could see a test of 635.8 levels, and resistance is now likely to be seen at 658.1, a move above could see prices testing 662.8.
 

Trading Ideas:
* Copper trading range for the day is 635.8-662.8.
* Copper prices rose as potential disruptions in producing countries raised worries of shortage of supply for the metal.
* Workers at BHP's Escondida, threatened to go on strike over what they described as safety concerns
* The global refined copper market showed a 66,000 tonne deficit in June, compared with a 30,000 tonne deficit in May


Zinc

Zinc yesterday settled up by 0.98% at 283.45 gaining support from linger pressure from overseas energy crisis on smelting activities, and the expected power rationing in Yunnan will probably reduce domestic production. Support also seen as the social inventory dropped palpably amid relatively robust market transactions. Foreign exchange reserves in China declined by $49.2 billion to $3.055 trillion in August of 2022, the lowest since October of 2018 and compared to market forecasts of $3.079 trillion. It was the second consecutive month of decreases mainly due to general dollar strength on expectations the Federal Reserve will continue aggressive policy tightening and global recession fears. The yuan fell 2.24% against the dollar in August, while the dollar rose 2.7% against a basket of other major currencies. Swedish miner Boliden has declared force majeure on zinc deliveries to Europe due to a strike among Norwegian electrochemical industry workers, although some production is still running. China's central bank saying it would cut the amount of foreign exchange reserves, a move seen to help limit yuan weakness. China's exports growth weakened in August, as surging inflation crippled overseas demand and fresh COVID curbs and heatwaves disrupted production, reviving downside risks for the economy. Technically market is under short covering as the market has witnessed a remain unchanged in open interest by 0% to settle at 1603 while prices are up 2.75 rupees, now Zinc is getting support at 281.3 and below same could see a test of 279.2 levels, and resistance is now likely to be seen at 285.4, a move above could see prices testing 287.4.
 

Trading Ideas:
* Zinc trading range for the day is 279.2-287.4.
* Zinc prices gained support from linger pressure from overseas energy crisis on smelting activities
* Support also seen as the social inventory dropped palpably amid relatively robust market transactions.
* China foreign exchange reserves at near 4-year low



Aluminium

Aluminium yesterday settled up by 1.37% at 200.1 as Germany's Speira will cut aluminium production by 50% from October at its Rheinwerk plant because of high power prices. European smelters are estimated to have cut an annualised 800,000 to 900,000 tonnes of aluminium production since energy prices began to rise last year. Smelting aluminium is extremely energy intensive and power prices in Europe, which increased further after Russia reduced gas supplies to Europe, have meant costs of production for many are higher than the market price. Global aluminium producers have offered Japanese buyers premiums of $115-$133 per tonne for October-December primary metal shipments, down 10-22% from the current quarter. Japan is Asia's biggest importer of the metal and the premiums for primary metal shipments it agrees to pay each quarter over the London Metal Exchange (LME) cash price set the benchmark for the region. For the July-September quarter, Japanese buyers agreed to pay a premium of $148 per tonne , down 14% from the previous quarter. China's exports growth weakened in August, as surging inflation crippled overseas demand and fresh COVID curbs and heatwaves disrupted production, reviving downside risks for the economy. Exports rose 7.1% in August from a year earlier, slowing from an 18.0% gain in July, official customs data showed. Technically market is under short covering as the market has witnessed a drop in open interest by -7.34% to settle at 4735 while prices are up 2.7 rupees, now Aluminium is getting support at 198.9 and below same could see a test of 197.7 levels, and resistance is now likely to be seen at 200.8, a move above could see prices testing 201.5.
 

Trading Ideas:
* Aluminium trading range for the day is 197.7-201.5.
* Aluminum gains as Germany's Speira to axe 50% of its aluminium output
* European smelters are estimated to have cut an annualised 800,000 to 900,000 tonnes of aluminium production since energy prices began to rise last year
* China exported 540,448.9 tonnes of unwrought aluminium and aluminium products in August, up 10.2% from last month.


Mentha oil

Mentha oil yesterday settled up by 0.31% at 1012.3 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-June 2022 has dropped by 5.75 percent at 493.45 tonnes as compared to 523.54 tonnes exported during Apr-June 2021. 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 the month of June 2022 around 113.33 tonnes of Mentha was exported as against 169.93 tonnes in June 2021 showing a decline of over 33%. In the month of May 2022 around 209.90 tonnes of Mentha was exported as against 179.76 tonnes in May 2021 showing a rise of 16.77%. 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 -0.9 Rupees to end at 1144 Rupees per 360 kgs.Technically market is under short covering as the market has witnessed a drop in open interest by -0.21% to settle at 1458 while prices are up 3.1 rupees, now Mentha oil is getting support at 1004 and below same could see a test of 995.7 levels, and resistance is now likely to be seen at 1019.2, a move above could see prices testing 1026.1.
 

Trading Ideas:
* Mentha oil trading range for the day is 995.7-1026.1.
* In Sambhal spot market, Mentha oil dropped  by -0.9 Rupees to end at 1144 Rupees per 360 kgs.
* Mentha oil gained amid low production this season and improving demand post-pandemic.
* However, upside seen limited as Synthetic Mentha supply remains uninterrupted.
* 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%.


Turmeric

Turmeric yesterday settled down by -0.58% at 7162 amid profit booking on report of better sowing. 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-June 2022 has rose by 23.44 percent at 49,435.38 tonnes as compared to 40,049.06 tonnes exported during Apr-June 2021. In the month of June 2022 around 18,532.00 tonnes turmeric was exported as against 17,137.15 tonnes in May 2022 showing a rise of 8.13%. In the month of June 2022 around 18,532.00 tonnes of turmeric was exported as against 13,206.00 tonnes in June 2021 showing an increase of 40.33%. In the month of May 2022 around 17,138.35 tonnes of turmeric was exported as against 13,576.68 tonnes in May 2021 showing an increase of 26.23%. 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 7372.55 Rupees dropped -26.45 Rupees.Technically market is under fresh selling as the market has witnessed a gain in open interest by 30.25% to settle at 10830 while prices are down -42 rupees, now Turmeric is getting support at 7118 and below same could see a test of 7074 levels, and resistance is now likely to be seen at 7234, a move above could see prices testing 7306.
 

Trading Ideas:
* Turmeric trading range for the day is 7074-7306.
* Turmeric dropped amid profit booking on report of better sowing.
* In the ongoing season, no major quality concerns were observed in the crop arrived in the Marathwada region.
* In the month of June 2022 around 18,532.00 tonnes turmeric was exported as against 17,137.15 tonnes in May 2022 showing a rise of 8.13%.
* In Nizamabad, a major spot market in AP, the price ended at 7372.55 Rupees dropped -26.45 Rupees.


Jeera

Jeera yesterday settled up by 0.62% at 24985 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-June 2022 has dropped by 42.98 percent at 47,190.98 tonnes as compared to 82,762.08 tonnes exported during Apr-June 2021. In the month of June 2022 around 21,587.63 tonnes jeera was exported as against 14,894.62 tonnes in May 2022 showing a rise of 44.94%. 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%. In the month of May 2022 around 14,894.62 tonnes of jeera was exported as against 20,693.76 tonnes in May 2021 showing a decrease of 28.03%. 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 -9.95 Rupees to end at 24395.5 Rupees per 100 kg.Technically market is under fresh buying as the market has witnessed a gain in open interest by 3.93% to settle at 6264 while prices are up 155 rupees, now Jeera is getting support at 24700 and below same could see a test of 24410 levels, and resistance is now likely to be seen at 25180, a move above could see prices testing 25370.
 

Trading Ideas:
* Jeera trading range for the day is 24410-25370.
* Jeera 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 -9.95 Rupees to end at 24395.5 Rupees per 100 kg.


Cotton

Cotton yesterday settled up by 1.48% at 36990 as 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. Cotton area is estimated at 126 lakh hectares till September 2 — up 8-9 per cent from 117 lakh hectares last year. 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." The crop size may touch 375 lakh bales if there are no rains during October. If it rains during October, when the cotton bolls are open in the irrigated fields, it may hamper the quality. In its monthly supply-demand report, the United States Department of Agriculture (USDA) cut its global production forecast by 3.1 million bales, and the U.S. output outlook by 3 million bales for the 2022-23 crop year. Hot and dry weather conditions in key growing areas in the United States have threatened the condition of the natural fiber crop and raised supply concerns. 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 dropped by -150 Rupees to end at 42890 Rupees.Technically market is under short covering as the market has witnessed a drop in open interest by -4.91% to settle at 601 while prices are up 540 rupees, now Cotton is getting support at 36480 and below same could see a test of 35970 levels, and resistance is now likely to be seen at 37300, a move above could see prices testing 37610.
 

Trading Ideas:
* Cotton trading range for the day is 35970-37610.
* Cotton gained as 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
* 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 dropped  by -150 Rupees to end at 42890 Rupees.

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