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Gold

Gold yesterday settled up by 0.1% at 50737 as the dollar index regained ground to trade above 110, recovering from its lowest level in over a month, after data showed the US economy remains resilient despite rising interest rates. The US economy grew an annualized 2.6% on quarter in the three months to September of 2022, more than market expectations of 2.4% and rebounding from a contraction in the first half of the year. The data comes against growing expectations that the Federal Reserve could pivot in December to prevent overtightening, after hiking rates for the fourth time by 75 bps in November. Elsewhere, the ECB delivered a second 75 bps rate hike as expected, and signaled more increases. New orders for the US manufactured durable goods increased 0.4% mom in September of 2022, following an upwardly revised 0.2% gain in August and beating market expectations for a 0.2% advance. New orders were up six of the last seven months. The number of Americans filing new claims for unemployment benefits rose by 3,000 to 217,000 on the week ending October 20th, below market forecasts of 220,000. The results halted expectations of a loosening labor market that emerged with previous releases in October, challenging recent rhetoric of a dovish pivot along with the stronger than expected GDP growth data for Q3. Technically market is under short covering as the market has witnessed a drop in open interest by -3.15% to settle at 11034 while prices are up 50 rupees, now Gold is getting support at 50583 and below same could see a test of 50430 levels, and resistance is now likely to be seen at 50882, a move above could see prices testing 51028.
 

Trading Ideas:
* Gold trading range for the day is 50430-51028.
* Gold steadied as the dollar index regained ground to trade above 110, recovering from its lowest level in over a month.
* Data showed the US economy remains resilient despite rising interest rates.
* The US economy grew an annualized 2.6% on quarter in the three months to September of 2022



Silver

Silver yesterday settled up by 0.19% at 58278 on hopes the US Federal Reserve could slow down the pace of interest rate increases soon to avoid overtightening. Investors are now almost certain that the US central bank will deliver a fourth-straight 75 bps rate hike on November 2nd but beliefs the Fed will pivot by December sparked a bond rally and dragged down the dollar, boosting the appeal of the non-interest bearing assets. U.S. economic growth rebounded more than expected in the third quarter amid a continued decline in the trade deficit, but that overstates the economy's health as the Federal Reserve's aggressive interest rate increases curbed consumer spending. Gross domestic product increased at a 2.6% annualized rate last quarter, the Commerce Department said in its advance GDP estimate, ending two straight quarterly decreases in output, which had raised concerns that the economy was in recession. European Central Bank raised interest rates for the third meeting in a row and signalled an intention to start mopping up cash from the banking system to fight record-high inflation. The ECB has been undoing years of aggressive stimulus in a matter of months after being blindsided by a sudden surge in prices – the result of higher energy costs caused by Russia's invasion of Ukraine and the economy's uneven reopening after the COVID-19 pandemic. Technically market is under short covering as the market has witnessed a drop in open interest by -1.66% to settle at 16544 while prices are up 112 rupees, now Silver is getting support at 57874 and below same could see a test of 57470 levels, and resistance is now likely to be seen at 58601, a move above could see prices testing 58924.
 

Trading Ideas:
* Silver trading range for the day is 57470-58924.

* Silver gains on hopes the US Federal Reserve could slow down the pace of interest rate increases soon to avoid overtightening.

* Investors are now almost certain that the US central bank will deliver a fourth-straight 75 bps rate hike in November

* U.S. economic growth rebounds in Q3 on trade, but demand is slowing



Crude oil

Crude oil yesterday settled up by 1.83% at 7362 as optimism over record U.S. crude exports and signs that recession fears are abating outweighed concern over slack demand in China. Figures showed record U.S. crude exports, a hopeful sign for demand. Speculation that central banks could be coming towards the end of their rate-hiking cycles added support, after the European Central bank raised rates by 75 basis points. The US exported a record amount of crude and fuel last week, with total petroleum shipments reaching 11.4 million barrels a day even as fuel inventories hit seasonal lows in domestic markets, adding to concerns about tight supply. Moreover, traders geared up for a major output cut by OPEC+ in November, as well as the European Union ban on Russian oil which will take effect in December. Meanwhile, Bloomberg reported that the US and EU are likely to settle for a more loosely policed cap at a higher price than previously planned, with just G7 nations and Australia committed to abide by it. U.S. crude stockpiles rose last week to the highest since July 2021, Energy Information Administration data showed. U.S. crude inventories rose to 439.9 million barrels in the week to Oct. 21. Technically market is under fresh buying as the market has witnessed a gain in open interest by 35.86% to settle at 6778 while prices are up 132 rupees, now Crude oil is getting support at 7243 and below same could see a test of 7124 levels, and resistance is now likely to be seen at 7439, a move above could see prices testing 7516.
 

Trading Ideas:
* Crude oil trading range for the day is 7124-7516.
* Crude oil rose as optimism over record U.S. crude exports and signs that recession fears are abating outweighed concern over slack demand in China
* U.S. crude exports surge to record, inventories rise
* US crude stocks rise to highest since July 2021 – EIA



Nat.Gas

Nat.Gas yesterday settled down by -3.25% at 484.6 as near-record output levels outweighed rising demand. The end of maintenance outages in plants including Berkshire Hathaway Energy, Cove Point LNG and Freeport LNG is set to increase LNG exports. Still, average gas output in the US Lower 48 states was at 99.5 bcfd so far in October, the same as the September record. Average US gas demand, including exports, is expected to rise to 96.6 bcfd next week, from 94.8 bcfd this week, according to Refinitiv's outlook. The latest EIA report showed US utilities added 52 billion cubic feet (bcf) of gas to storage last week, below market expectations of a 59 bcf build. It compares with an increase of 88 in the same week last year and a five-year (2017-2021) average increase of 66 bcf. Data provider Refinitiv said average gas output in the U.S. Lower 48 states held at 99.4 bcfd so far in October, tying the monthly record in September. With seasonally cooler weather coming, Refinitiv projected average U.S. gas demand, including exports, would rise from 94.8 bcfd this week to 96.6 bcfd next week. The forecast for this week was higher than Refinitiv's outlook on Wednesday, while its forecast for next week was lower. Technically market is under fresh selling as the market has witnessed a gain in open interest by 44.57% to settle at 8913 while prices are down -16.3 rupees, now Natural gas is getting support at 468.4 and below same could see a test of 452.1 levels, and resistance is now likely to be seen at 506.5, a move above could see prices testing 528.3.
 

Trading Ideas:
* Natural gas trading range for the day is 452.1-528.3.
* Natural gas dropped as near-record output levels outweighed rising demand.
* However, downside seen limited on expectations that LNG exports would increase due to the end of maintenance outages in plants
* Average US gas demand, including exports, is expected to rise to 97.1 bcfd next week, from 93.9 bcfd this week




Copper

Copper yesterday settled up by 0.13% at 664.15 amid hopes that demand may improve amid the possibility that the Fed could slow its tightening momentum. Concerns of tight supplies in the long run were also prevalent, with industrial players flagging increasing risks of shortages. Commodity trader Trafigura warned that global copper stocks have fallen to record lows, with current inventories enough to supply world consumption for just 4.9 days. Freeport-McMoran was also vocal about shortage risks, stating that the current low prices do not reflect the tightness in the physical market. Economic contraction and deepening recession fears drove copper prices to currently trade at 30% below the peak of $5 hit in March. Chile's Codelco, the world's largest copper miner expects copper demand in China, its main consumer, to be resilient, despite slower economic growth there. The global copper market is expected to see a deficit of about 325,000 tonnes this year and a surplus of 155,000 tonnes in 2023, the International Copper Study Group (ICSG) said. "Continued COVID-19 related restrictions and workforce absenteeism, operational and geotechnical issues, strikes, water restrictions in Chile, lower than expected head grades and community actions in Peru have constrained mine output at a number of operations this year," it said in a release. Technically market is under fresh buying as the market has witnessed a gain in open interest by 0.8% to settle at 4914 while prices are up 0.85 rupees, now Copper is getting support at 661.1 and below same could see a test of 658 levels, and resistance is now likely to be seen at 666.8, a move above could see prices testing 669.4.
 

Trading Ideas:
* Copper trading range for the day is 658-669.4.
* Copper gains amid hopes that demand may improve amid the possibility that the Fed could slow its tightening momentum.
* Concerns of tight supplies in the long run were also prevalent, with industrial players flagging increasing risks of shortages.
* Global copper market to see 155,000 tonne surplus in 2023, says ICSG



Zinc

Zinc yesterday settled down by -0.41% at 270.5 as a gloomy outlook of global economy fanned concerns of tepid demand for metals. Production cuts in Europe because of the energy crisis and low inventories have sustained zinc prices over the last year, but headwinds emanating from growth and demand slowdown are now a bigger challenge for the market. The latest on production cuts comes from Glencore , which plans to close its Nordenham zinc smelter in Germany from Nov. 2. The London-listed miner put its Portovesme zinc operation in Italy on care and maintenance last November. According to latest data from General Administration of Customs, China imported 390,600 mt of zinc concentrates in September 2022, up 142,000 mt or 3.77% MoM and 53.49% YoY. The imports totalled 2.88 million mt in January-September, a year-on-year increase of 5.7%. The global zinc market deficit rose to 101,100 tonnes in August from a revised deficit of 83,000 tonnes a month earlier, data from the International Lead and Zinc Study Group (ILZSG) showed. Previously, the ILZSG had reported a deficit of 72,800 tonnes in July. During the first eight months of 2022, ILZSG data showed a deficit of 4,000 tonnes versus a deficit of 49,000 tonnes in the same period of 2021. Technically market is under fresh selling as the market has witnessed a gain in open interest by 9.75% to settle at 2669 while prices are down -1.1 rupees, now Zinc is getting support at 268.4 and below same could see a test of 266.3 levels, and resistance is now likely to be seen at 273.9, a move above could see prices testing 277.3.
 

Trading Ideas:
* Zinc trading range for the day is 266.3-277.3.
* Zinc prices dropped as a gloomy outlook of global economy fanned concerns of tepid demand for metals.
* China imported 390,600 mt of zinc concentrates in September 2022, up 142,000 mt or 3.77% MoM and 53.49% YoY.
* Global zinc market deficit climbs to 101,100 T in August – ILZSG




Aluminium

Aluminium yesterday settled down by -1.61% at 201.2 as macro-economic concerns and improving production in world's top producer China weighed on markets. Still, a gloomy outlook of global economy fanned concerns of tepid demand for metals. This was against the backdrop of rising production in China, following relaxed power restrictions this year. Global primary aluminium output in September rose 4.28% year on year to 5.702 million tonnes, data from the International Aluminium Institute (IAI) showed. Estimated Chinese production was 3.398 million tonnes in September, the IAI said. Aluminium ingot social inventory dropped 15,000 mt from a week ago to 621,000 mt as of this Thursday October 27. However, falling aluminium ingot social inventory failed to boost SHFE aluminium as the longs left the market. The transportation has been greatly hindered by the pandemic. And SHFE aluminium will be struggling for direction in the near term. Recently, some Fed officials have expressed desire to slow down the pace of interest rate hikes as soon as possible. According to the report, Fed officials may discuss whether and how to signal that a smaller rate hike is planned in December, and the market is now fully expecting the Fed to raise interest rates by 75 basis points (bps) in November and 50 bps in December. Technically market is under long liquidation as the market has witnessed a drop in open interest by -6.22% to settle at 5188 while prices are down -3.3 rupees, now Aluminium is getting support at 199 and below same could see a test of 196.9 levels, and resistance is now likely to be seen at 204.5, a move above could see prices testing 207.9.
 

Trading Ideas:
* Aluminium trading range for the day is 196.9-207.9.
* Aluminum dropped as macro-economic concerns and improving production in world's top producer China weighed on markets.
* Global aluminium output rises 4.28% y/y in September – IAI
* Aluminium ingot social inventory dropped 15,000 mt from a week ago to 621,000 mt as of this Thursday October 27.



Mentha oil

Mentha oil yesterday settled down by -0.03% at 987.9 as mentha exports during Apr-Aug 2022 has dropped by 14.27 percent at 886.53 tonnes as compared to 1034.14 tonnes exported during Apr-Aug 2021. Exports in the month of August 2022 were around 238.04 tonnes as against 155.04 tonnes in July 2022 showing a rise of 53.53%. In the month of August 2022 around 238.04 tonnes of Mentha was exported as against 227.27 tonnes in August 2021 showing a rose of 4.74%. Synthetic Mentha supply remains uninterrupted. Support also seen amid low production this season and improving demand post-pandemic. 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, 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. 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 -13.1 Rupees to end at 1123.4 Rupees per 360 kgs.Technically market is under fresh selling as the market has witnessed a gain in open interest by 0.43% to settle at 1166 while prices are down -0.3 rupees, now Mentha oil is getting support at 985 and below same could see a test of 982.2 levels, and resistance is now likely to be seen at 989.8, a move above could see prices testing 991.8.
 

Trading Ideas:
* Mentha oil trading range for the day is 982.2-991.8.
* In Sambhal spot market, Mentha oil dropped  by -13.1 Rupees to end at 1123.4 Rupees per 360 kgs.
* Mentha oil prices dropped as exports during Apr-Aug 2022 has dropped by 14.27 percent
* August exports were around 238.04 tonnes showing a rise of 53.53% compared to July 2022.
* However, Synthetic Mentha supply remains uninterrupted.

 

Turmeric 

Turmeric yesterday settled down by -1.45% at 7462 amid lower demand from domestic spice-makers and stockists amid availability of Turmeric supply form Marathwada region. Marathwada region has been serving as a round-the-year supply centre for Turmeric since past couple of years. Agriculture Minister Narendra Singh Tomar said unseasonal rains in some parts of the country have affected the crops. As per Andhra Pradesh agricultural department, as on 06th October 2022 Turmeric sowing activity completed around 16,921 hectares as compared to last year same period 19,376 hectares, down by 12.67% till date. Turmeric exports during Apr-August 2022 has rose by 15.35 percent at 74,393.62 tonnes as compared to 64,493.34 tonnes exported during Apr- August 2021. In the month of August 2022 around 12,147.89 tonnes turmeric was exported as against 12,810.36 tonnes in July 2022 showing a drop of 5.17%. In the month of August 2022 around 12,147.89 tonnes of turmeric was exported as against 11,617.90 tonnes in August 2021 showing a rise of 4.56%. 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 7270.55 Rupees gained 5.4 Rupees.Technically market is under long liquidation as the market has witnessed a drop in open interest by -3.66% to settle at 9600 while prices are down -110 rupees, now Turmeric is getting support at 7316 and below same could see a test of 7168 levels, and resistance is now likely to be seen at 7730, a move above could see prices testing 7996.
 

Trading Ideas:
* Turmeric trading range for the day is 7168-7996.
* Turmeric dropped amid lower demand from domestic spice-makers and stockists amid availability of Turmeric supply.
* As per Andhra Pradesh agricultural department, turmeric sowing activity completed around 16,921 hectares, down by 12.67% till date from last year.
* Marathwada region has been serving as a round-the-year supply centre for Turmeric since past couple of years.
* In Nizamabad, a major spot market in AP, the price ended at 7270.55 Rupees gained 5.4 Rupees.



Jeera

Jeera yesterday settled up by 0.64% at 24250 due to moisture conditions as a result of higher rainfall sowing may be delayed by 10 to 15 days current year. Current year Jeera sowing is likely to start from October last week or November first week in Gujarat growing regions. However, reports sowing started in some parts of Rajasthan as moisture conditions is less and completed around 2% to 3% in the key growing regions. Current year sowing area likely to increase in Rajasthan and Gujarat growing regions. Jeera exports during Apr-August 2022 has dropped by 26.44 percent at 91,505.49 tonnes as compared to 1,24,390.31 tonnes exported during Apr- August 2021. In the month of August 2022 around 24,448.33 tonnes jeera was exported as against 19,866.18 tonnes in July 2022 showing a rise of 18.74%. In the month of August 2022 around 24,448.33 tonnes of jeera was exported as against 17,460.60 tonnes in August 2021 showing a rise of 40.02%. 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 up by 11.3 Rupees to end at 23951.45 Rupees per 100 kg.Technically market is under short covering as the market has witnessed a drop in open interest by -5.09% to settle at 6213 while prices are up 155 rupees, now Jeera is getting support at 23925 and below same could see a test of 23600 levels, and resistance is now likely to be seen at 24675, a move above could see prices testing 25100.
 

Trading Ideas:
* Jeera trading range for the day is 23600-25100.
* Jeera rose due to moisture conditions as a result of higher rainfall sowing may be delayed by 10 to 15 days current year.
* Current year sowing area likely to increase in Rajasthan and Gujarat growing regions.
* 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 up by 11.3 Rupees to end at 23951.45 Rupees per 100 kg.



Cotton

Cotton yesterday settled down by -2.12% at 29530 as India is likely to produce 34.4 million bales of cotton in the 2022/23 season that started on Oct. 1, up 12% from a year ago after farmers expanded the crop area. India’s cotton output for the season ended September 30, 2022, fell to 307.5 lakh bales (against 360.13 lakh bales estimated at the beginning of the season in October last year. This is the lowest since 2007-08, when the production was 307 lakh bales. WASDE report said world trade is projected to be nearly 1 million bales lower from September, with declines in imports by China, Pakistan, Mexico, Turkey and Vietnam. The agency lowered its U.S. exports forecast by 100,000 bales to 12.5 million bales, while also cutting export estimates for Australia, Brazil, India, Benin, Cote d’Ivoire, Greece and Mexico. "In the 2022/23 world balance sheet this month, consumption is 3.0 million bales lower and ending stocks are 3.1 million bales higher," the USDA said. USDA said its estimates for 2022/23 U.S. cotton crop ending stocks are 100,000 bales higher from a year earlier, with production nearly unchanged at 13.8 million bales. In Gujarat, new cotton arrival increased, and daily arrival reached 6,000 bales of 170 kg. Ginning mills have started buying seed cotton with the advent of the auspicious festival of Navratri. However, spinning mills are cautious as they expect a downward trend in cotton prices during peak arrival. In spot market, Cotton dropped by -140 Rupees to end at 31760 Rupees.Technically market is under long liquidation as the market has witnessed a drop in open interest by -0.09% to settle at 2142 while prices are down -640 rupees, now Cotton is getting support at 29120 and below same could see a test of 28700 levels, and resistance is now likely to be seen at 30280, a move above could see prices testing 31020.
 

Trading Ideas:
* Cotton trading range for the day is 28700-31020.
* Cotton dropped as India’s cotton output seen rising 12% on bigger crop area
* However downside seen limited as crops remain threatened due to adverse weather conditions and pest attacks in major growing regions.
* USDA projected higher year-end stocks and a decline in exports amid a slowdown in consumption.
* In spot market, Cotton dropped  by -140 Rupees to end at 31760 Rupees.

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