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Daily Commodities Outlook

Bullion Outlook

• Gold prices edged up on Friday as the dollar and US treasury yields fell after US economic data showed easing wage growth and contraction in the service sector. Disappointing economic data cemented expectations of a less hawkish Fed. Apart from this, two US Fed officials signalled a smaller rate hike at the next policy meeting

• Gold is expected to trade with a positive bias for the day amid weakness in the dollar and decline in US treasury yields. Further, bullion prices may be supported on expectations that the US Federal Reserve will slow the pace of interest rate hikes. MCX Gold is likely to surpass the key resistance level of 55,800 to continue its upward trend towards the level of 56,200 level

• MCX silver prices rose almost 1.60% on Friday. It is likely to surpass the hurdle of 69,800 to continue its upward trend towards the level of 70,100

Base Metal Outlook

• Copper edged higher on Friday amid a weak dollar and on hopes that demand will pick up in China with new efforts to boost its troubled property sector

• Moreover, copper also gained support from news that Chile’s total copper production fell 6.9% in November to 449,000 tones

• Meanwhile, disappointing factory orders data from the US weighed on copper prices. New orders for US manufactured goods declined 1.8% in November 2022, compared with market expectations of a 0.8% decline

• Copper is expected to trade with a positive bias for the day amid rise in risk appetite in the global markets and weakness in dollar. Further, copper will be supported on expectations that policymakers in China will roll out more support measures to stimulate demand. MCX Copper may rise till 740 level as long as it sustains above 730 level

Energy Outlook

• Crude oil prices traded flat on Friday as the market balanced a weaker US dollar and mixed US jobs reports

• Moreover, upside was restricted as Covid-19 flare-ups in China threatened demand growth and offset the impact of supply shortfalls caused by sanctions on Russia

• Crude oil prices are likely to trade with a positive bias amid weakness in dollar and optimistic global market sentiments. Market sentiments improved as fresh data showed a slowdown in wage growth, a buoyant sign for Fed battle against inflation that could ease pressure for further rate hike. Further, oil prices may rally as travellers streamed into China following a reopening of borders. MCX crude oil prices may rally back till 6300 level as long as it sustains above 6190 levels

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