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Gold

Gold yesterday settled down by -0.67% at 58290 as U.S. 10-year Treasury yield reached its highest in 10 months, underpinned by fears that U.S. interest rates might stay higher for longer, contributing, along with China's economic woes. Fed minutes showed policy makers were divided over the need for more interest rate increases, with some citing the risk to the economy of pushing hikes too far. U.S. retail sales data came out strong, and traders are also watching the Atlanta Federal Reserve's GDP Now forecast model, which showed the U.S. economy is likely to be growing at a 5.8% annualised rate in the third quarter. Expectations for U.S. peak rates have not changed significantly, however. Rather, the changes in yields have been driven by changes in medium-term rate expectations. China's economy was the other topic on investors' minds as a series of economic data and ructions in the property sector have laid bare the stumbling post-pandemic recovery. Strong economic data weighed on precious metals, as industrial production expanded more than expected in July to ease concerns that the sector is waning from higher borrowing costs, adding some tightening leeway for the FOMC. Technically market is under fresh selling as the market has witnessed a gain in open interest by 1.76% to settle at 13729 while prices are down -391 rupees, now Gold is getting support at 58150 and below same could see a test of 58005 levels, and resistance is now likely to be seen at 58565, a move above could see prices testing 58835.
Trading Ideas:
* Gold trading range for the day is 58005-58835.
* Gold dropped as U.S. 10-year Treasury yield hits highest since October
* Fed minutes showed policy makers were divided over the need for more interest rate increases
* U.S. retail sales data came out strong, and traders are also watching the Atlanta Federal Reserve's GDP Now forecast model

Silver

Silver yesterday settled up by 0.42% at 70018 amid solid industrial demand and tight supply. The FOMC’s latest meeting prolonged the expected period that the Federal Reserve could start cutting interest rates, denting demand for non-interest-bearing bullion assets. Fed members believe that upside risks to inflation persist, raising the possibility that interest rates could still be increased. Still, some policymakers expressed uncertainty over the duration of policy transmission lags, raising caution of overtightening for the Committee's more dovish members. Strong economic data also weighed on precious metals, as industrial production expanded more than expected in July to ease concerns that the sector is waning from higher borrowing costs, adding some tightening leeway for the FOMC. The US retail sales report showed higher than expected growth for July, fueling bets that the interest rates would stay elevated longer and raising the opportunity cost of holding non-interest-bearing precious metals. Also, Chinese faltering economy added to the bearish trend. China's industrial production, retail sales and fixed asset investment all rose below projections, while the urban unemployment rate ticked higher. Technically market is under short covering as the market has witnessed a drop in open interest by -13.91% to settle at 14920 while prices are up 296 rupees, now Silver is getting support at 69300 and below same could see a test of 68580 levels, and resistance is now likely to be seen at 70815, a move above could see prices testing 71610.
Trading Ideas:
* Silver trading range for the day is 68580-71610.
* Silver seen supported amid solid industrial demand and tight supply.
* The FOMC’s latest meeting prolonged the expected period that the Federal Reserve could start cutting interest rates
* Fed members believe that upside risks to inflation persist, raising the possibility that interest rates could still be increased.

Crudeoil

Crudeoil yesterday settled up by 0.59% at 6685 after China's central bank sought to stem the rising tide of pessimism over the country's property market and wider economy. Prices are rebounding on expectations that Chinese officials will deliver meaningful stimulus and that the oil market will remain tight. On a more bullish note, China made a rare draw on crude oil inventories in July, the first time in 33 months that it has dipped into storage. Net input of crude oil by U.S. refiners rose last week to its highest since January 2020, before the COVID-19 pandemic slashed demand, data from the Energy Information Administration showed. Refinery crude runs rose by 167,000 barrels per day to 16.7 million bpd in the week to Aug. 11, EIA said. U.S. crude oil and gasoline inventories fell last week, while distillate stockpiles rose, Energy Information Administration data showed. Crude inventories fell by 5.96 million barrels in the last week to 439.7 million barrels, compared with expectations for a 2.3 million-barrel drop. Crude stocks at the Cushing, Oklahoma, delivery hub fell by 837,000 barrels in the last week, EIA said. Refinery crude runs rose by 167,000 barrels per day in the last week, EIA said. Technically market is under short covering as the market has witnessed a drop in open interest by -22.64% to settle at 3397 while prices are up 39 rupees, now Crudeoil is getting support at 6594 and below same could see a test of 6504 levels, and resistance is now likely to be seen at 6754, a move above could see prices testing 6824.
Trading Ideas:
* Crudeoil trading range for the day is 6504-6824.
* Crude oil gains as China's bank tackles property market worries, economy downturn
* China made a rare draw on crude oil inventories in July, the first time in 33 months that it has dipped into storage.
* US refinery crude input rises to highest since Jan 2020 – EIA

Naturalgas

Naturalgas yesterday settled up by 0.97% at 218.9 amid expectations that a hotter-than-normal weather forecast until end-August, especially in Texas. US utilities added 35 billion cubic feet (bcf) of natural gas into storage during the week ended August 11, 2023, more than market expectations of a 34 billion cubic feet increase. Last week's increase lifted stockpiles to 3.065 trillion cubic feet (tcf), 549 bcf higher than last year at this time and 299 bcf above the five-year average of 2.766 tcf. At 3.065 tcf, total working gas is within the five-year historical range. Data provider Refinitiv forecast U.S. gas demand, including exports, would rise from 103.1 billion cubic feet per day (bcfd) this week to 104.4 bcfd next week. But these numbers were lower from Monday's forecast. Refinitiv said average gas output in the Lower 48 states was 101.8 bcfd so far in August, nearly the same as the 101.8 bcfd in July, and not far from a monthly record of 102.2 bcfd in May. Meteorologists forecast weather in the Lower 48 states to remain hotter than normal through at least Aug. 29. Technically market is under short covering as the market has witnessed a drop in open interest by -9.06% to settle at 31714 while prices are up 2.1 rupees, now Naturalgas is getting support at 215 and below same could see a test of 211 levels, and resistance is now likely to be seen at 222.6, a move above could see prices testing 226.2.
Trading Ideas:
* Naturalgas trading range for the day is 211-226.2.
* Natural gas gains amid expectations that a hotter-than-normal weather forecast
* US utilities added 35 billion cubic feet (bcf) of natural gas into storage
* Data provider Refinitiv forecast U.S. gas demand, including exports, would rise from 103.1 bcfd


Copper

Copper yesterday settled up by 0.37% at 723.6 as net long positions of copper on the London Metals Exchange (LME) are at a six-month high, partly fuelled by low Chinese copper inventories data. Combined inventory in the Shanghai Futures Exchange and Chinese bonded warehouses were 110,314 metric tonnes on Aug. 11, down 53% year-on-year and equivalent to just under three days of consumption. The total net long position in LME copper rose to 9,488 contracts on Aug. 11, the highest since Feb. 10, data provided in the Commitments of Traders Report showed. Chinese copper stocks readily available in the spot market, which includes stocks in warehouses of the Shanghai Futures Exchange, totalled 82,600 tonnes on Aug. 14, up 17.5% year-on-year. However, Chinese bonded warehouse inventory, at 57,399 tonnes on Aug. 11, was down 70% from the same time last year, data showed. China's refined copper production in July jumped 14.5% to 1.03 million metric tons year-on-year, although sliding from a record high scaled in the prior month, data from the National Bureau of Statistics showed. On a daily basis, average copper output stood at 33,226 tons during July, according to calculations based on the official data. Technically market is under short covering as the market has witnessed a drop in open interest by -11.9% to settle at 4899 while prices are up 2.65 rupees, now Copper is getting support at 719.3 and below same could see a test of 715 levels, and resistance is now likely to be seen at 726.8, a move above could see prices testing 730.
Trading Ideas:
* Copper trading range for the day is 715-730.
* Copper prices gains fuelled by low Chinese copper inventories data
* Combined inventory in SHFE and Chinese bonded warehouses were down 53% year-on-year
* China's July refined copper output jumps 14.5% y/y

Zinc

Zinc yesterday settled up by 0.02% at 210.15 after China's central bank injected more money into the market to support the economy. China's central bank injected more liquidity into the market, making more money available to support financial assets. LME cash zinc flipped to a discount of $4.25 a ton over the three-month contract on Wednesday, after remaining in a premium zone since Aug. 3, indicating easing supply tightness. Zinc inventories in LME-registered warehouses have surged to a 17-month high, highlighting a market surplus amid weak demand. LME stocks of the metal mainly used for galvanising steel have jumped to 141,750 metric tons, LME inventory data showed on Wednesday, the highest since March 2022. The jump in zinc inventories took place ahead of the expiry of LME monthly futures contracts on Wednesday, when investors can deliver physical metal into LME warehouses to satisfy their futures positions. Looking forward, S&P Global anticipates a moderate growth of 1.4% in the worldwide demand for refined zinc in 2023, influenced by ongoing inflation and stringent monetary policies in both the US and Europe. Meanwhile, weak manufacturing data and a struggling property sector suggested more stimulus is needed to enhance the world's largest economy. Technically market is under short covering as the market has witnessed a drop in open interest by -9.6% to settle at 3577 while prices are up 0.05 rupees, now Zinc is getting support at 208 and below same could see a test of 205.6 levels, and resistance is now likely to be seen at 212.5, a move above could see prices testing 214.6.
Trading Ideas:
* Zinc trading range for the day is 205.6-214.6.
* Zinc gains after China's central bank injected more money to support the economy
* LME cash zinc flipped to a discount of $4.25 a ton over the three-month contract, after remaining in a premium zone since Aug. 3.
* Zinc inventories in LME-registered warehouses have surged to a 17-month high, highlighting a market surplus amid weak demand.


Aluminium

Aluminium yesterday settled down by -0.03% at 196.9 recovering from lows following support measures from China. China's commerce ministry demanded that the United States immediately lift the tariffs imposed on Chinese steel and aluminium imports. The discount on aluminium for near-term delivery compared with the three-month contract on the London Metal Exchange (LME) has reached its highest since the global financial crisis of 2008, indicating weak demand and rising supply. The discount, or contango, for cash aluminium against the three-month contract climbed to $55.50 a metric tonne at Monday's market close for its highest level since November 2008. That compared to a premium, or backwardation, of $40.50 at the end of May. The contango has persisted since early June, when China's Yunnan province started ramping up energy-intensive aluminium production after the end of power curbs. Global primary aluminium output rose by 1.8% year on year in the first half of 2023, mainly owing to higher production in China, according to the International Aluminium Institute. In July China's output rose to near-record levels. Sentiment surrounding the construction sector has deteriorated further with the suspension of bond trading by Country Garden. Technically market is under long liquidation as the market has witnessed a drop in open interest by -13.21% to settle at 3135 while prices are down -0.05 rupees, now Aluminium is getting support at 194.7 and below same could see a test of 192.4 levels, and resistance is now likely to be seen at 199.3, a move above could see prices testing 201.6.
Trading Ideas:
* Aluminium trading range for the day is 192.4-201.6.
* Aluminium settled flat following support measures from China
* Morgan Stanley lowers China's GDP forecast for 2023 to 4.7% from 5%.
* Morgan Stanley lowers China's GDP prediction for 2024 to 4.2% from 4.5%.

Cottoncandy

Cottoncandy yesterday settled down by -1.45% at 59920 amid concerns over a slowdown in top buyer China. Cotton Association of India (CAI) maintained the cotton crop production forecast for the 2022-23 season at 311.18 lakh bales. In the last cotton season, the total cotton production was at 307.05 lakh bales, CAI said in a statement. The total cotton supply for October 2022 to July 2023 is estimated at 332.30 lakh bales, which consists of arrivals of 296.80 lakh bales, imports of 11.50 lakh bales and the opening stock estimated by the CAI at 24 lakh bales at the beginning of the season. Arrivals in Punjab have been recorded at almost one-third of the previous year, 2021-22. In Punjab the arrival of cotton in the 2022-23 marketing season has been recorded at 8.7 lakh quintal till date this year, while it was 28.89 lakh quintal for the entire 2021-22 season. USDA weekly export sales report showed net sales of 277,700 running bales of cotton for 2023/2024, with increases primarily for China. During this Kharif season, cotton cultivation in Gujarat has achieved a remarkable milestone, surpassing the records of the past eight years. The state's farmers have successfully planted cotton across an extensive 26.64 lakh hectare area, showcasing a stark contrast to the declining trend witnessed in other major cotton-producing states. In Rajkot, a major spot market, the price ended at 29208.4 Rupees dropped by -0.05 percent. Technically market is under long liquidation as the market has witnessed a drop in open interest by -10.93% to settle at 334 while prices are down -880 rupees, now Cottoncandy is getting support at 59600 and below same could see a test of 59280 levels, and resistance is now likely to be seen at 60440, a move above could see prices testing 60960.
Trading Ideas:
* Cottoncandy trading range for the day is 59280-60960.
* Cotton dropped amid concerns over a slowdown in top buyer China.
* CAI maintained the crop forecast for 2022-23 at 311.18 lakh bales.
* Crop in North India is under the threat of pink bollworm attacks
* In Rajkot, a major spot market, the price ended at 29208.4 Rupees dropped by -0.05 percent.

Turmeric

Turmeric yesterday settled down by -2.12% at 15664 on profit booking after prices gained amid limited availability of quality produce in the market. Ongoing sowing and crop progress is major price driver for turmeric and forecast of drier weather in southern and central region has added worries to turmeric crops. Sowing activities almost completed in Maharashtra and likely to pick up in Andhra Pradesh and Tamil Nadu but erratic monsoon rainfall has impacted the sowing progress. The looming threat of El Nino casts a shadow over the upcoming turmeric crop. Meteorological predictions suggest the activation of El Nino in July, potentially resulting in reduced rainfall and drought conditions. Such conditions could particularly impact yields, like turmeric, that heavily rely on monsoon irrigation. Farmers shift in focus has led to expectations of a 20-25 percent decrease in turmeric sowing this year, notably in states like Maharashtra, Tamil Nadu, Andhra Pradesh, and Telangana. Turmeric exports during Apr-Jun 2023, rose by 16.87 percent at 57,775.30 tonnes as compared to 49,435.38 tonnes exported during Apr- Jun 2022. In Nizamabad, a major spot market, the price ended at 14146.85 Rupees dropped by -1.78 percent. Technically market is under long liquidation as the market has witnessed a drop in open interest by -1.29% to settle at 15685 while prices are down -340 rupees, now Turmeric is getting support at 15330 and below same could see a test of 14994 levels, and resistance is now likely to be seen at 16126, a move above could see prices testing 16586.
Trading Ideas:
* Turmeric trading range for the day is 14994-16586.
* Turmeric dropped  on profit booking after prices gained amid limited availability
* Sowing activities almost completed in Maharashtra and likely to pick up in Andhra Pradesh and Tamil Nadu
* In Jun 2023 around 18,356.57 tonnes was exported as against 19827.86 tonnes in May 2023 showing a drop of 7.42%.
* In Nizamabad, a major spot market, the price ended at 14146.85 Rupees dropped by -1.78 percent.


Jeera

Jeera yesterday settled up by 0.79% at 59055 as supply is limited due to the rainy environment. However, upside seen limited in wake of improved global supply condition. Cheaper availability of Syria and jeera in global market will lead to fall in export demand from India in coming days. Drier weather condition in Gujarat will also lead to rise in arrivals that will cap the upwards move. China’s cumin imports and exports have caused temporary corrections in cumin prices, with a recent $200 decrease in the international market. The possibility of China purchasing Indian cumin in October-November before the arrival of new cumin adds further uncertainty to the market dynamics. According to FISS forecasts, cumin demand is predicted to exceed 85 lakh bags this year, with a likely supply of 65 lakh bags. Jeera exports during Apr-Jun 2023, rose by 13.16 percent at 53,399.65 tonnes as compared to 47,190.98 tonnes exported during Apr- Jun 2022. In Jun 2023 around 10,411.14 tonnes of jeera was exported as against 25,903.63 tonnes in May 2023 showing a drop of 59.81%. In Jun 2023 around 10,411.14 tonnes of jeera was exported as against 21,587.63 tonnes in Jun 2022 showing a drop of 51.78%. In Unjha, a major spot market, the price ended at 60409 Rupees gained by 0.22 percent. Technically market is under short covering as the market has witnessed a drop in open interest by -4.64% to settle at 6600 while prices are up 465 rupees, now Jeera is getting support at 57760 and below same could see a test of 56450 levels, and resistance is now likely to be seen at 59930, a move above could see prices testing 60790.
Trading Ideas:
* Jeera trading range for the day is 56450-60790.
* Jeera gained as supply is limited due to the rainy environment.
* However, upside seen limited in wake of improved global supply condition.
* Cheaper availability of Syria and jeera in global market will lead to fall in export demand from India in coming days.
* In Unjha, a major spot market, the price ended at 60409 Rupees gained by 0.22 percent.

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