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GOLD

Gold prices continue to be under pressure for the second straight day, as the dollar index rose together with treasury yields, which capped the upside in the yellow metal. Gold prices concluded the day with a 0.29 percent cut and ended at 1710.9$ per ounce.

Investors are awaiting the US jobs report that would decide further movement in gold, and also help gauge the Federal reserve's rate hike path.

Given the decline in the dollar index from its multi-year highs, gold is likely to end the week on an upbeat note, gaining about 3%.

Outlook: We expect gold to trade lower towards 51640 levels, a break of which could prompt the price to move lower to 51410 levels.

CRUDE

Crude prices continue to hold strong, as both the benchmark indices Brent and NYMEX ended with marginal gains, up 0.97 and 0.79 percent respectively.

After the announcement of the output cut in the wake of the declining oil prices, crude has continued to maintain its upward trend. The OPEC+ decided to reduce production targets by 2 million barrels per day, tightening the global supply.

This production decrease was the biggest since 2020 and comes ahead of a European Union embargo on Russian oil. The decision would limit supply in a competitive market.

Outlook: The output cut by OPEC+ would likely continue to keep the prices elevated. However, a bounceback in the dollar index would likely limit the upside.

BASE METALS

The industrial metals pack continue to witness mixed trading session, as on the LME and MCX, except for Copper and Aluminium all the others ended on a higher note.

Shutdowns at smelters still haunt the metals pack. After the closure of the zinc and aluminum smelters, concerns over the closure of a lead smelter and a drop in stockpiles, which are at a three-decade low, kept the prices afloat.

Zinc prices continue to surge, as the benchmark LME imposed restrictions on metal from a Russian company. Additionally, another zinc smelter is going into care and maintenance, making it the third West European zinc smelter to close over the last year as operators struggle to cope with surging power prices.

A stronger dollar index also weighed on the market, making the commodities priced in US dollars more expensive for customers using foreign currencies.

Outlook: We expect copper to trade lower towards 648 levels, a break of which could prompt the price to move lower to 638 levels.

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