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Gold

Gold prices fell by 5.79% to settle at 68,510 INR, primarily influenced by India's decision to cut import duties on gold from 15% to 6%. This policy change is expected to stimulate retail demand and reduce gold smuggling. Concurrently, the U.S. real estate market reported a significant decline in existing home sales, which dropped by 5.4% to 3.89 million units in June 2024, marking the steepest fall since 2022. Swiss gold exports in June fell to their lowest level since April 2022, attributed to decreased shipments to China and India. Both countries, being major consumer markets, showed subdued demand due to high gold prices. In Asia, physical gold demand remained weak despite significant discounts, as customers were hesitant to make new purchases. Indian dealers offered a discount of up to $65 an ounce, the highest in 28 months, while Chinese dealers offered a discount of up to $6 an ounce. In Singapore and Hong Kong, gold was sold at varying discounts and premiums, and in Japan, dealers charged premiums of $0.50-$1 per ounce due to more selling than buying activities. From a technical perspective, the gold market is experiencing fresh selling pressure, with a 6.42% increase in open interest, settling at 11,357 contracts while prices dropped by 4,208 INR. Gold is currently supported at 67,030 INR, with potential testing of 65,545 INR if the downtrend continues. Resistance is expected around 71,425 INR, and a move above this level could see prices testing 74,335 INR.

Trading Ideas:

* Gold trading range for the day is 65545-74335.
* Gold dropped as India slashed import duties on gold to 6% from 15%.
* Existing home sales in the US fell by 5.4% from the previous month to a seasonally adjusted annualized rate of 3.89 million units in June
* Markets are anticipating a 94% chance of a rate cut by the U.S. Federal Reserve in September
 
 
 
Silver

Silver prices dropped by 4.8% to settle at 84,919 INR after India reduced import duties on silver from 15% to 6%. This policy shift aims to enhance retail demand and curb smuggling activities. Market participants are keenly observing forthcoming U.S. economic data, which includes the advance estimate for Q2 GDP growth, personal spending and income, and the June PCE price index, the Fed's preferred inflation measure. U.S. headline inflation recently decreased to 3% in June, marking a one-year low, while core inflation fell to 3.3%, the lowest in over three years. In political developments, investors are evaluating the impact of President Joe Biden ending his reelection bid and endorsing Vice President Kamala Harris as his successor. Meanwhile, China's economy grew less than anticipated in Q2, with mixed economic indicators for June and no major policy shifts from the Third Plenum to address economic challenges. The U.S. housing market reported a 5.4% decline in existing home sales in June 2024, reaching an annualized rate of 3.89 million units, the lowest since the beginning of the year. This marks the fourth consecutive monthly decline, with the median home price climbing to a record high of $426,900. From a technical standpoint, the silver market is experiencing fresh selling pressure, with a 2.02% increase in open interest to settle at 26,996 contracts while prices fell by 4,284 INR. Silver is currently supported at 83,125 INR, with further downside potential to 81,330 INR. Resistance is anticipated around 87,865 INR, and a move above this level could see prices testing 90,810 INR.

Trading Ideas:

* Silver trading range for the day is 81330-90810.
* Silver dropped as India slashed import duties on silver to 6% from 15%.
* Pressure also seen amid a weakening demand outlook in China dampened investor sentiment.
* Traders focused on upcoming US economic data to reinforce rate-cut expectations by the Federal Reserve.
 
 
Crude oil

 
Crude oil prices declined by 1.55% to settle at 6,458 INR, driven by increasing expectations of a ceasefire in Gaza, which alleviated concerns about potential supply disruptions. Efforts led by U.S. President Biden and mediated by Egypt and Qatar have advanced toward securing a ceasefire between Israel and Hamas, with significant progress noted over the past month. Israeli Prime Minister Netanyahu indicated a possible nearing of a Gaza hostage deal, with a meeting scheduled with President Biden at the White House. In the production sphere, Russia's oil output is reportedly aligning with the OPEC+ quotas, according to Deputy Prime Minister Alexander Novak. The OPEC+ group is unlikely to recommend changes to its output policy, including the planned unwinding of certain oil supply cuts starting in October. Market dynamics showed the premium for front-month U.S. crude futures over the second-month contract reached its highest level since October, reflecting tighter supply as inventories at the WTI delivery point in Cushing, Oklahoma, hit a three-month low. U.S. crude oil inventories fell by 4.87 million barrels in the week ending July 12, 2024, marking the third consecutive week of declines, contrary to market expectations of an 0.8 million barrel increase. Technically, the crude oil market is experiencing fresh selling pressure, evidenced by a 43.81% increase in open interest, settling at 8,521 contracts while prices dropped by 102 INR. Crude oil is currently supported at 6,376 INR, with a potential test of 6,293 INR if the downtrend continues. Resistance is anticipated at 6,571 INR, and a move above this level could see prices testing 6,683 INR.

Trading Ideas:

* Crudeoil trading range for the day is 6293-6683.
* Crude oil fell as growing expectations of a ceasefire in Gaza reduced the risk of supply disruptions.
* Russia's oil output is close to OPEC+ quotas, Deputy PM Novak says
* The upcoming OPEC+ meeting scheduled for August 1 is not expected to change current output policies.
 
 
Natural gas

 
Natural gas prices declined by 2.44% to settle at 183.6 INR, primarily due to rising output and an ongoing oversupply in storage. Despite smaller-than-usual injections over the past 10 weeks, storage levels are about 17% higher than the seasonal norm, reflecting an oversupplied market. According to LSEG, gas output in the Lower 48 states averaged 102.3 billion cubic feet per day (bcfd) in July, an increase from 100.2 bcfd in June and a 17-month low of 99.4 bcfd in May. The record high was set in December 2023 at 105.5 bcfd. Meteorologists forecast that weather across the Lower 48 states will remain mostly normal until July 27, after which it is expected to become hotter than normal through at least August 7, potentially influencing demand. In China, the National Energy Administration projects natural gas demand to grow between 6.5% and 7.7% this year, reaching 420-425 billion cubic meters. This growth estimate surpasses the previous forecast by state energy giant CNPC, which predicted a 6.1% increase. Additionally, China’s domestic natural gas production is expected to reach 246 bcm in 2024, marking a significant annual increase. U.S. utilities added 10 billion cubic feet of gas to storage in the week ending July 12, 2024, which was below market expectations of a 28 billion cubic feet increase. From a technical perspective, the natural gas market is experiencing long liquidation, with a significant drop in open interest by 27.09% to settle at 12,971 contracts while prices fell by 4.6 INR. Natural gas is currently supported at 180.9 INR, with further downside potential to 178.1 INR. Resistance is anticipated at 188.2 INR, and a move above this level could see prices testing 192.7 INR.

Trading Ideas:

* Naturalgas trading range for the day is 178.1-192.7.
* Natural gas slid on rising output and an ongoing oversupply of gas in storage.
* There was still about 17% more gas in storage than normal for this time of year
* China's natural gas demand seen growing 6.5% – 7.7% in 2024, NEA says
  
 
Copper

 
Copper prices fell by 0.86% to settle at 807 INR due to growing concerns over demand in China, the top consumer of the metal. Chinese copper producers exported a record 157,751 tons last month amid weak domestic consumption, leading to increased inventories in LME-registered warehouses. Consequently, LME copper stocks rose to 236,700 tons, the highest level since September 2021. The global refined copper market exhibited a surplus of 65,000 metric tons in May, up from an 11,000 metric ton surplus in April, according to the International Copper Study Group (ICSG). For the first five months of the year, the market recorded a surplus of 416,000 metric tons, significantly higher than the 154,000 metric ton surplus during the same period last year. World refined copper output in May was 2.37 million metric tons, while consumption was 2.31 million metric tons. When adjusted for changes in inventory in Chinese bonded warehouses, the surplus in May was 78,000 metric tons, compared to 31,000 metric tons in April. China's unwrought copper imports declined to a 14-month low in June, totaling 436,000 metric tons, a 3% drop from the previous year and the lowest since April 2023. Technically, the copper market is experiencing long liquidation, with a significant drop in open interest by 34.2% to settle at 4,587 contracts while prices fell by 7 INR. Copper is currently supported at 801.4 INR, with further downside potential to 795.8 INR. Resistance is anticipated at 812.9 INR, and a move above this level could see prices testing 818.8 INR.

Trading Ideas:

* Copper trading range for the day is 795.8-818.8.
* Copper prices dropped on growing concern over demand in China.
* Chinese copper producers shipped out a record 157,751 tons last month.
* Copper market in 65,000 metric tons surplus in May 2024 – ICSG
 
 
 
Zinc

Zinc prices declined by 1.61% to settle at 259.5 INR amid various supply and demand factors influencing the market. China's refined zinc production in June increased by 9,700 metric tons month-over-month to 545,800 metric tons, although it was down 1.2% year-over-year. The first half of 2024 saw a total output of 3.182 million metric tons, slightly down by 1.39% year-over-year but exceeding expectations. In the same month, domestic zinc alloy production fell by 1,800 metric tons to 93,000 metric tons. Production in China exceeded expectations due to higher-than-expected output in Guangxi, Gansu, and Guizhou. Some smelters in Shaanxi, Gansu, Yunnan, and Guizhou resumed operations post-maintenance, while others in Hunan faced reductions due to maintenance shutdowns. London Metal Exchange (LME) zinc inventories saw a 9% rebound to their highest level in nearly three months, signaling a surplus of metal in the market. Despite this, LME zinc stocks had declined by 13% since their peak in February. The global zinc market surplus decreased to 22,100 metric tons in April from 70,100 metric tons in March, according to the International Lead and Zinc Study Group, with the first four months of 2024 showing a surplus of 182,000 tons compared to 282,000 tons in the same period last year. Technically, the zinc market is under long liquidation, with a significant drop in open interest by 29.93% to settle at 864 contracts while prices fell by 4.25 INR. Zinc currently finds support at 255.7 INR, with further downside potential to 252 INR. Resistance is likely at 263.3 INR, and a move above this level could see prices testing 267.2 INR.

Trading Ideas:

* Zinc trading range for the day is 252-267.2.
* Zinc dropped as in June, China's refined zinc production was up 1.81% MoM
* In June, China's refined zinc production was 545,800 mt, up 9,700 mt or 1.81% MoM
* Zinc inventories in warehouses registered with the London Metal Exchange rebounded 9% to their highest level in nearly three months
 
 
 Aluminium
 
Aluminium prices fell by 0.83% to settle at 213.95 INR as investors liquidated bullish positions amid concerns about demand, particularly due to the lack of new stimulus measures from China. Market participants were hoping for signs that the Chinese government would take significant actions to address the country’s prolonged property slump, which is a major driver of industrial metals demand. Global primary aluminium output in June increased by 3.2% year-over-year to 5.94 million metric tons, according to the International Aluminium Institute (IAI). For the first half of 2024, output rose by 3.9% to 35.84 million metric tons, mainly driven by higher production in China. China, the world’s largest aluminium producer, reported a 7% increase in aluminium output for the first half of the year, reaching 21.55 million metric tons. June's production was the highest in nearly a decade. The IAI estimated China’s production at 21.26 million metric tons for January-June, up 5.2% year-over-year. In Western and Central Europe, aluminium output increased by 2.2% to 1.37 million metric tons, while production in Russia and Eastern Europe rose by 2.4% to 2.04 million metric tons. Aluminium stocks at three major Japanese ports stood at 317,860 metric tons at the end of June, up about 3% from the previous month. Technically, the aluminium market is experiencing long liquidation, with a significant drop in open interest by 24.52% to settle at 1,616 contracts as prices fell by 1.8 INR. Aluminium is currently supported at 212.5 INR, with further downside potential to 211 INR. Resistance is likely at 216.2 INR, and a move above this level could see prices testing 218.4 INR.

Trading Ideas:

* Aluminium trading range for the day is 211-218.4.
* Aluminium prices fell as some bullish positions were scrapped and amid concerns about demand.
* Global primary aluminium output rose by 3.9% year-on-year to 35.84 million metric tons in the first half of 2024
* Global aluminium output rises 3.2% year on year in June – IAI
 
 
Cotton candy

 
Cotton candy prices settled down by 0.27% at 56310 INR, driven by profit booking after recent gains. The decline in prices is partly due to the significant reduction in cotton acreage in Punjab, Haryana, and Rajasthan, which collectively reported 10.23 lakh hectares under cotton compared to last year's 16 lakh hectares. Punjab saw a notable drop to 97,000 hectares from the normal 7.58 lakh hectares seen in the 1980s and 1990s. Despite the decline in acreage, support for cotton prices is coming from the delayed arrival of shipments from the US and Brazil, triggering demand for Indian cotton from mills in neighboring countries. The USDA's 2024/25 US cotton projections indicate higher beginning and ending stocks compared to the previous month, with production, domestic use, and exports unchanged. The season average upland farm price is down 4 cents from the May forecast to 70 cents per pound, following a decline in new-crop cotton futures. Globally, the 2024/25 cotton balance sheet shows increased beginning stocks, production, and consumption, with unchanged world trade. World ending stocks are projected 480,000 bales higher than in May at 83.5 million. In Rajkot, a major spot market, the price ended at 27674.25 INR, dropping by 0.26 percent. Technically, the market is under long liquidation, witnessing a 13.4% drop in open interest to settle at 265 contracts, while prices fell by 150 INR. Currently, cotton candy is getting support at 56140 INR, with further support potentially at 55970 INR. Resistance is likely at 56590 INR, and a move above could see prices testing 56870 INR.

Trading Ideas:

* Cottoncandy trading range for the day is 55970-56870.
* Cotton dropped on profit booking after prices gained as area under cotton in North India drops
* China's agriculture ministry raised its forecast for cotton imports in the 2023/24 crop year by 200,000 metric tons
* The 2024/25 U.S. cotton projections show higher beginning and ending stocks compared to last month.
* In the global 2024/25 cotton balance sheet, beginning stocks, production and consumption are increased.
 
 
Turmeric

 
Yesterday, Turmeric prices settled down by -0.69% at 15,938 amid reports of increased sowing. Despite this decline, the downside was limited as farmers held back stocks in anticipation of further price increases. Farmers receiving fair prices for their produce has incentivized extensive sowing across all major producing states. Reports suggest that turmeric sowing in Erode has doubled compared to last year, and in Maharashtra, Telangana, and Andhra Pradesh, sowing has increased by 30-35% compared to the previous year. Last year, turmeric was sown in approximately 3-3.25 lakh hectares across India, with this year’s estimates rising to 3.75-4 lakh hectares. The unfavorable weather last year contributed to lower production, estimated at 45-50 lakh bags, with an outstanding stock of 35-38 lakh bags. Despite the increased sowing this season, the expected turmeric crop will be around 70-75 lakh bags, while the outstanding stock will be zero, leading to lower availability of turmeric than consumption in 2025. In 2023, turmeric production was 80-85 lakh bags, with an outstanding stock of 25-30 lakh bags. Turmeric exports during April-May 2024 dropped by 20.03% to 31,523.94 tonnes, compared to 39,418.73 tonnes in the same period in 2023. In May 2024, 17,414.84 tonnes of turmeric were exported, up by 23.43% from April 2024, but down by 12.17% from May 2023. In Nizamabad, a major spot market, the price ended at 16,347.45 rupees, down by -0.14%. Technically, the market is under fresh selling pressure, with a 0.94% increase in open interest to 16,100 contracts while prices fell by 110 rupees. Currently, turmeric has support at 15,710, with further support at 15,480 levels. Resistance is expected at 16,150, with a potential move above this level leading to prices testing 16,360.

Trading Ideas:

* Turmeric trading range for the day is 15480-16360.
* Turmeric prices dropped amid news of increased sowing.
* Turmeric sowing on the Erode line is reported to be double as compared to last year.
* Turmeric was sown in about 3/3.25 lakh hectares in the country last year, which is estimated to increase to 3.75/4 lakh hectares this year.
* In Nizamabad, a major spot market, the price ended at 16458.1 Rupees gained by 0.68 percent.
 
 
Jeera

 
Yesterday, Jeera prices settled up by 0.04% at 26,250 amid robust domestic and export demand, alongside tight global supplies. However, the upside was limited due to expectations of higher production, which could weigh on prices. Farmers holding back their stocks in anticipation of better prices further bolstered the market. Globally, jeera production has also seen significant increases, especially in China, where output surged to over 55-60 thousand tonnes from the previous 28-30 thousand tonnes. High prices in the previous season incentivized increased production in Syria, Turkey, and Afghanistan, with new supplies expected to enter the market in June and July. Turkey anticipates producing 12-15 thousand tonnes, while Afghanistan's output could double, weather permitting. As these new supplies enter the market, cumin prices are expected to decline. Additionally, reduced export trade in cumin contributes to the price drop, indicating a shift in global cumin market dynamics. In India, the sowing area in Gujarat's Mehsana, Banaskantha, and Patan districts increased by 30-35% this year. Similarly, Rajasthan's Jaisalmer, Barmer, Jodhpur, and Ajmer districts saw a 35% increase in sowing area. The total production of cumin in Gujarat is estimated to be a record 4.08 lakh tonnes, up from 2.15 lakh tonnes in 2022-23. Technically, the market is under short covering, with a 2.95% drop in open interest to 26,000 contracts while prices rose by 10 rupees. Jeera has support at 25,960, with further support at 25,660 levels. Resistance is likely at 26,500, with a potential move above this level leading to prices testing 26,740.

Trading Ideas:

* Jeera trading range for the day is 25660-26740.
* Jeera gains amid robust domestic and export demand besides tight global supplies.
* China's cumin output soared to over 55-60 thousand tons from the previous 28-30 thousand tons.
* Turkey anticipates producing 12-15 thousand tons, while Afghanistan's output could double.
* In Unjha, a major spot market, the price ended at 26479.55 Rupees dropped by -0.68 percent.

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