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Below is Gold Article by Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities, and Currencies, Angel One Ltd

GOLD

Gold continues to climb higher for the second day straight, as on Wednesday prices managed to hold onto the gains.

Despite the recent retracement, gold is on track for its first monthly fall in three months as the US dollar rose on anticipation that the Federal Reserve will hold interest rates higher for longer than previously believed.

The strong US dollar is likely to continue to be a drag on gold prices.

Fed funds futures predict a 62% chance of a 25 basis point raise at the central bank's June meeting. Interest rate increases continue to be a drag on gold because they increase the opportunity cost of owning non-yielding metal.

Outlook: We expect gold to trade higher towards 60540 levels, a break of which could prompt the price to move higher to 60700 levels.

CRUDE

The sharp fall seen in crude prices in the previous sessions, has further extended, as benchmark crude prices fell for yet another day. Brent slipped over 3 percent, whereas, NYMEX ended nearly 2 percent lower.

The fall comes after after data showed an unexpected, large build in US crude stocks last week, triggering fears of an oversupply amid signs of weaker Chinese demand, too.

Market participants now await government data on U.S. crude stocks due later on Thursday. The data was delayed by a day because of a U.S. holiday earlier this week. EIA/S

Meanwhile, statistics from China indicated that manufacturing activity fell quicker than estimated in May, raising concerns about demand in the world's second-biggest oil user.

Outlook: Weak Chinese industrial data and the US debt ceiling settlement in Congress, along with a likely increase in stockpiles, would most likely be a barrier to the rise in oil prices.

BASE METALS

Base metals continue to be under the bear grip, as prices of the metals slip over 1 percent, whereas Zinc slipped over 2 percent on the LME and 3 percent on the MCX.

On Wednesday, copper prices fell back to six-month lows after data revealed that factory activity in main consumer China contracted quicker than predicted in May.

According to National Bureau of Statistics data, China's factory activity decreased due to decreasing demand, with the official manufacturing purchasing managers' index (PMI) at 48.8, well below the 50-point threshold separating expansion from contraction.

The figures provided fresh indication that China's economic recovery, which is already centred on services rather than metals-intensive manufacturing or construction, is fading.

China's yuan fell to its lowest level against the dollar since November, putting pressure on dollar-priced metals by making them more expensive for Chinese buyers.

Outlook: We expect copper to trade higher towards 717 levels, a break of which could prompt the price to move higher to 722 levels.

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