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Gold

Gold yesterday settled down by -0.11% at 48066 as investors continued to track reports about surging coronavirus cases and weigh the variant's impact on the economic recovery. Global equities steadied and oil prices eased on concerns that the Omicron variant could slow the economy in the new year. Investors continued to fret about a surge of Covid-19 cases around the world and its economic impact on the economic recovery. Airlines across the world cancelled just under 8,000 flights over the three-day Christmas weekend due to the spread of the Omicron variant, flight delays and cancellations related to staff shortages. The number of Americans filing new claims for unemployment benefits held below pre-pandemic levels last week, while consumer spending increased solidly, putting the economy on track for a strong finish to 2021. But price pressures continued to build up, with a measure of underlying inflation recording its largest annual increase since the 1980s in November. Physical gold demand was mixed in top Asian hubs, with overall activity subdued going into Christmas and the new year, although the upcoming holidays prompted some consumers in Singapore to pick up bullion for gifting. In India, dealers were offering a discount of up to $2 an ounce over official domestic prices unchanged from the last week. In top consumer China, premiums of $6-$9 an ounce were charged, unchanged from last week. Technically market is under long liquidation as market has witnessed drop in open interest by -0.57% to settled at 8698 while prices down -53 rupees, now Gold is getting support at 47994 and below same could see a test of 47923 levels, and resistance is now likely to be seen at 48192, a move above could see prices testing 48319.

Trading Ideas:

* Gold trading range for the day is 47923-48319.
* Gold settled flat as investors continued to track reports about surging coronavirus cases and weigh the variant's impact on the economic recovery.
* Global equities steadied and oil prices eased on concerns that the Omicron variant could slow the economy in the new year.
* Investors continued to fret about a surge of Covid-19 cases around the world and its economic impact on the economic recovery.

Silver

Silver yesterday settled remain unchangeby 0% at 62301 as the spread of Omicron further threatens the global economy, supporting prices as safe haven demand. Lockdown restrictions have been tightened in the Chinese city of Xi’an, which is battling the largest community outbreak the country has seen since the initial months of the pandemic when China brought thousands of daily infections under control. In the US, daily Covid cases soared to the highest in nearly a year, leading to the cancellation of more than 2,000 flights over the holiday weekend. Investor confidence grew on signs that omicron might be less severe than feared. Early studies suggested it carries a lower risk of hospitalization and causes a milder illness. Reports also showed that US drugmakers Merck and Pfizer’s Covid antiviral pills were effective against the new variant. Moreover, expectations that inflation is likely to persist buoyed gold prices, with the Fed-preferred PCE index surging to 5.7% in November, its fastest pace since 1982. New orders for US manufactured durable goods rose 2.5% over the same period, faster than forecasts of 1.6%, and initial jobless claims were steady at 205 thousand last week, still below pre-pandemic levels, reflecting businesses’ resilience amid increasing headwinds from disruptions caused by the pandemic. Technically market is under long liquidation as market has witnessed drop in open interest by -0.46% to settled at 10593 while prices remain unchanged 3 rupees, now Silver is getting support at 61786 and below same could see a test of 61272 levels, and resistance is now likely to be seen at 62730, a move above could see prices testing 63160.

Trading Ideas:

* Silver trading range for the day is 61272-63160.
* Silver remained in range as the spread of Omicron further threatens the global economy, supporting prices as safe haven demand.
* Early studies suggested it carries a lower risk of hospitalization and causes a milder illness.
* New orders for US manufactured durable goods rose 2.5% over the same period

Crude oil

Crude oil yesterday settled up by 2.62% at 5673 Crude oil gained as prices rebounded after early weakness amid hopes the Omicron variant of the coronavirus will not any significantly impact global economic recovery. In the US, almost 2,400 flights were cancelled over the holiday weekend, with major airlines citing the spread of omicron among crews as a reason for the disruption. Japan's industry ministry said it will hold an auction on Feb. 9 to sell about 100,000 kilolitres, or 628,980 barrels, of crude oil from its national reserve as a part of a U.S.-led coordinated release of oil reserve to cool rising prices. The supply, to be taken from its Shibushi tank in southwestern Japan, will become available to the winning bidder on March 20 or later, it said in a statement. Japan's government said last month that it would release "a few hundred thousand kilolitres" of oil in response to a U.S. request, and the sale would be done as part of a switch in the composition of the types of oil held in the national reserve. Meanwhile, markets zero in on the next OPEC+ meeting on Jan. 4, as the group is set to decide whether to go ahead with a planned 400,000 barrels per day production increase in February. Technically market is under fresh buying as market has witnessed gain in open interest by 20.38% to settled at 8789 while prices up 145 rupees, now Crude oil is getting support at 5520 and below same could see a test of 5366 levels, and resistance is now likely to be seen at 5766, a move above could see prices testing 5858.

Trading Ideas:

* Crude oil trading range for the day is 5366-5858.
* Crude oil gained as prices rebounded amid hopes the Omicron variant of the coronavirus will not any significantly impact global economic recovery.
* Japan to auction more than 600,000 bbl of oil from national reserves in Feb
* Markets zero in on the next OPEC+ meeting on Jan. 4, as the group is set to decide whether to go ahead with a planned 400,000 barrels per day

Nat.Gas

Nat.Gas yesterday settled up by 5.95% at 292.2 spurred by forecasts for colder weather and higher heating demand over the next two weeks. HDDs, used to estimate demand to heat homes and businesses, measure the number of degrees a day's average temperature is below 65 Fahrenheit (18 Celsius). Refinitiv projected average U.S. gas demand, including exports, would jump from 110.0 billion cubic feet per day (bcfd) this week to 126.7 bcfd next week as the weather turns seasonally colder. Output in the U.S. Lower 48 has averaged 97.0 billion cubic feet per day (bcfd) so far in December, which would top the monthly record of 96.5 bcfd in November. UK natural gas prices slumped below 270 pence a therm, in line with the Dutch contract and has shed more than 40% from a record 451.72 pence over the past four sessions, as more US LNG tankers sailed to the UK and other European countries, whilst fears of a Russian invasion of Ukraine faded. Moscow withdrew over 10,000 troops from drills near the Ukraine border, easing concerns about harsh economic sanctions being slapped on Russian gas exports. Meanwhile, out of the 15 American LNG tankers with declared destinations in Europe, 4 were headed to the UK and 1 to Gibraltar, while one undeclared ship was moored at a UK anchorage. Technically market is under short covering as market has witnessed drop in open interest by -36.42% to settled at 5329 while prices up 16.4 rupees, now Natural gas is getting support at 279.8 and below same could see a test of 267.3 levels, and resistance is now likely to be seen at 299.3, a move above could see prices testing 306.3.

Trading Ideas:

* Natural gas trading range for the day is 267.3-306.3.
* Natural gas gained spurred by forecasts for colder weather and higher heating demand over the next two weeks.
* Refinitiv projected average U.S. gas demand, including exports, would jump from 110.0 bcfd this week to 126.7 bcfd next week
* EIA said utilities pulled 55 billion cubic feet (bcf) of gas from storage during the week ended Dec. 17.

Copper

Copper yesterday settled up by 0.82% at 754.05 as worries eased over the impact of the rapidly spreading Omicron coronavirus variant on global demand. Many investors have taken a break until after the New Year holidays, while worries about Omicron also prompt caution. Profits at China's industrial firms grew at a much slower pace in November, official data showed, pressured by tumbling prices of some raw materials, a faltering property market and weaker consumer demand. In China, the copper inventory in the bonded zone dropped 2,200 mt to 171,700 mt from last Friday, marking the 11th consecutive week of decline. A South African study confirmed again the omicron variant is less severe than previous strains, albeit more infectious. Higher supplies and softer demand are expected to cool copper prices next year after a dizzying climb to record highs this year, but the metal's central role in the energy transition will keep sentiment positive. Expectations of slower demand growth in China and rising supplies from operations such as Anglo American's Quellaveco mine in Peru are likely to keep prices subdued next year. Technically market is under fresh buying as market has witnessed gain in open interest by 7.69% to settled at 4021 while prices up 6.1 rupees, now Copper is getting support at 743.9 and below same could see a test of 733.7 levels, and resistance is now likely to be seen at 761.5, a move above could see prices testing 768.9.

Trading Ideas:

* Copper trading range for the day is 733.7-768.9.
* Copper prices gains as worries eased over the impact of the rapidly spreading Omicron coronavirus variant on global demand.
* Many investors have taken a break until after the New Year holidays, while worries about Omicron also prompt caution.
* Profits at China's industrial firms grew at a much slower pace in November, official data showed.
 

Zinc

Zinc yesterday settled up by 0.64% at 291.1 as China’s central bank pledged greater support for the real economy and said it will make monetary policy more forward-looking and targeted, amid expectations of easing as a property slowdown saps growth. Total zinc inventory across seven Chinese markets stood at 126,700 mt as of December 27, up 2,500 mt from December 24 and 2,500 mt from December 20. The inventory in Shanghai continued to decline as imported zinc available in the market thinned, some major plants implemented maintenance and in-plant stocks were at low levels. The stocks in Guangdong stopped falling and increased as the arrivals of goods increased and the restocking demand from downstream plants declined. Tianjin saw a continuous accumulation of stocks as downstream demand continued to weaken and arrivals of goods in the market stabilised. Inventories in Shanghai, Guangdong and Tianjin rose 1,300 mt, and inventories across seven Chinese markets increased 2,500 mt. Overall sentiment was upbeat, with a global share rally continuing as markets welcomed positive news about the impact of the Omicron variant and U.S. economic data. On the demand side, the downstream companies were even more sluggish in demand during the seasonal low, coupled with rising zinc prices, which is a bearish factor for zinc. Technically market is under fresh buying as market has witnessed gain in open interest by 18.86% to settled at 2199 while prices up 1.85 rupees, now Zinc is getting support at 289 and below same could see a test of 286.8 levels, and resistance is now likely to be seen at 292.7, a move above could see prices testing 294.2.

Trading Ideas:

*  Zinc trading range for the day is 286.8-294.2.
* Zinc prices gains as China’s central bank pledged greater support for the real economy
* Total zinc inventory across seven Chinese markets stood at 126,700 mt as of December 27, up 2,500 mt from December 24
* Overall sentiment was upbeat, with a global share rally continuing as markets welcomed positive news about the impact of the Omicron variant
 

Nickel

Nickel yesterday settled up by 0.25% at 1551.7 as China will keep its monetary policy flexible next year as it seeks to stabilise growth and lower financing costs for businesses. On the fundamentals, the nickel sulphate market was still pessimistic, and NPI demand rose limitedly amid maintenance plans of steel mills. The nickel ore inventory at Chinese ports dipped 118,000 wmt from a week earlier to 8.66 million wmt as of December 24. Total Ni content stood at 68,000 mt. The total inventory at seven major ports stood at around 3.96 million wmt, a drop of 108,000 wmt from a week earlier. The nickel ore inventories have fallen for five consecutive weeks since the end of November as the imports have decreased significantly. However, the downstream demand is also relatively weak due to the current high costs and the impact of environmental protection and production restrictions in some areas. Hence the inventory decline was not noticeable. The global nickel market saw a small surplus of 5,000 tonnes in October compared with a shortfall of 3,100 tonnes a month earlier, data from the International Nickel Study Group (INSG) showed. During the first 10 months of the year, there was a deficit in the nickel market of 165,500 tonnes compared with a surplus of 88,500 tonnes in the same period last year, Lisbon-based INSG added. Technically market is under fresh buying as market has witnessed gain in open interest by 9.05% to settled at 1626 while prices up 3.9 rupees, now Nickel is getting support at 1539.4 and below same could see a test of 1527.2 levels, and resistance is now likely to be seen at 1562.2, a move above could see prices testing 1572.8.

Trading Ideas:

* Nickel trading range for the day is 1527.2-1572.8.
* Nickel gains as China will keep its monetary policy flexible next year as it seeks to stabilise growth and lower financing costs for businesses.
* The nickel sulphate market was still pessimistic, and NPI demand rose limitedly amid maintenance plans of steel mills.
* The global nickel market saw a small surplus of 5,000 tonnes in October compared with a shortfall of 3,100 tonnes a month earlier

Aluminium

Aluminium yesterday settled up by 0.26% at 228.2 as sentiment was upbeat, with a global share rally continuing as markets welcomed positive news about the impact of the Omicron variant and U.S. economic data. There were concerns Concerns over Europe's slowing economic growth on the back of surging prices and new COVID restrictions and as the European Central Bank is seen tightening policy slower than the US Federal Reserve. The bloc's central bank announced earlier this month a reduction in the pace of its asset purchases due to the progress on economic recovery and towards its medium-term inflation target, but signaled interest rates will be kept at record-low levels for some time. Elsewhere, the Fed said it would speed up its tapering of bond purchases, putting it on track to conclude it in March 2022 and paving the way for three interest rate hikes by the end of next year. Also, latest data showed China's output of alumina, which is smelted to make aluminum, fell in November by 4.5% year-on-year to its lowest in 18 months as regions impose curbs on the aluminum raw material. Still, the price of aluminum remains about 10% below its 13-year high of $3,172 reached in mid-October, as supply disruptions connected to higher energy prices in China eased and aluminum ingot inventories have been falling at a slower pace as cargoes pile up at railway stations in Xinjiang and the major Chinese manufacturing province of Zhejiang is fighting a Covid-19 outbreak Technically market is under fresh buying as market has witnessed gain in open interest by 4.38% to settled at 2905 while prices up 0.6 rupees, now Aluminium is getting support at 227 and below same could see a test of 225.7 levels, and resistance is now likely to be seen at 229, a move above could see prices testing 229.7.

Trading Ideas:

* Aluminium trading range for the day is 225.7-229.7.
* Aluminium gains as sentiment was upbeat, with a global share rally continuing as markets welcomed positive news about the impact of the Omicron variant
* The aluminium ingot social inventory kept falling by 25,000 mt to 839,000 mt, mainly as the arrivals in south and east China dropped.
* On-warrant aluminium stocks in LME-registered warehouses have fallen from 861,600 tonnes on Dec. 14 to 731,500 tonnes, suggesting tight supply.
 

Mentha oil

Mentha oil yesterday settled up by 0.04% at 983.6 as demand from consumer side is extremely weak and industrial demand is also not picking up. Prices got support in last few weeks as due to crop failure and low recovery of oil, availability of Mentha oil will be low and demand from industries are expected to improve ahead of winter season. Speculation are also high that production this year will be lower as compare with last year because of two important factors. Major physical market player expects demand to sluggish for next few week as cash crunch seen in spot market, while expectations are high about demand improvement ahead of winter season starts. China is one of the biggest buyer for Indian Mentha, no much buying inquiry from China as mainland China and Hong Kong markets were shut. Speculation are also high that production this year will be lower as compare with last year because of two important factors. Firstly damages due to rain in key area and secondly farmers for the last 2 years where sowing mentha but due to not getting much profit at intervals there had been shift to other crops also. In Sambhal spot market, Mentha oil gained by 2.7 Rupees to end at 1095.2 Rupees per 360 kgs.Technically market is under fresh buying as market has witnessed gain in open interest by 7.89% to settled at 889 while prices up 0.4 rupees, now Mentha oil is getting support at 980.2 and below same could see a test of 976.7 levels, and resistance is now likely to be seen at 986.1, a move above could see prices testing 988.5.
 

Trading Ideas:

* Mentha oil trading range for the day is 976.7-988.5.
* In Sambhal spot market, Mentha oil gained  by 2.7 Rupees to end at 1095.2 Rupees per 360 kgs.
* Mentha oil prices settled flat as demand from consumer side is extremely weak
* Availability of Mentha oil will be low and demand from industries are expected to improve ahead of winter season.
* Further production this year will be lower as compare with last year because of two important factors.

 

Turmeric

Turmeric yesterday settled up by 0.71% at 9048 on good domestic and export demand, besides fears of heavy rains having affected the new crop due next month. The sentiment improved on reports of damage to the crop in Telangana and Andhra Pradesh. The market sentiment is buoyant mainly since the ending stocks are expected to be 17-18 lakh bags (50 kg each) this year against 25 lakh bags last year. This year, the crop was also lower compared with last year, he said. Also, the quality of the produce was not good, resulting in prices gaining. Spices Board data showed turmeric production this year being projected at 11.01 lakh tonnes against 11.78 lakh tonnes last year, mainly on the output being affected in Telangana, Karnataka, Tamil Nadu, Assam and Haryana. In view of the heavy rains in the growing areas, particularly Maharashtra, the next crop’s yield could be lower. Spices Board data show turmeric exports lower by 26 per cent in volume during the first half of the current fiscal at 77,245 tonnes valued at ₹860.31 crore against 1.04 lakh tonnes valued at ₹903.31 crore during the same period a year ago. In Nizamabad, a major spot market in AP, the price ended at 8065.9 Rupees dropped -24.6 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 0.49% to settled at 6130 while prices up 64 rupees, now Turmeric is getting support at 8954 and below same could see a test of 8862 levels, and resistance is now likely to be seen at 9134, a move above could see prices testing 9222.

Trading Ideas:

* Turmeric trading range for the day is 8862-9222.
* Turmeric prices ended with gains amid lower stocks, reports of disease hitting yield in Karnataka
* The sentiment improved on reports of damage to the crop in Telangana and Andhra Pradesh.

* The ending stocks are expected to be 17-18 lakh bags (50 kg each) this year against 25 lakh bags last year.
* In Nizamabad, a major spot market in AP, the price ended at 8065.9 Rupees dropped -24.6 Rupees.

Jeera
Jeera yesterday settled down by -0.15% at 16170 as better arrivals are expected in the spot market as the cumin production area in Gujarat is increasing rapidly. Cumin exports declined by 1.4% year-on-year to 1.39 lakh tonnes in April-September but are expected to improve in the coming months. Further adequate stock with traders and farmers may keeping prices under pressure at higher levels. However downside seen limited as domestic demand is now picking up also the export inquiries to support price. The area under cumin in Gujarat is only 1.71 lakh hectares as against 3 lakh hectares in the same period last year, while in Rajasthan, cumin was sown in 3.20 lakh hectares. Jeera production in Syria and Turkey was limited due to bad weather, which increases demand for Indian cumin. Exports of spices from India during Apr-Sep declined 8% on year to 780,273 tn, according to data from the Spices Board India. In terms of value, exports rose 3% to 154.6 bln rupees. India exported 77,245 tn of turmeric in Apr-Sep, down 26% on year. During last two months, the prices were higher compared to last year despite sufficient stocks with traders. Sowing can see drop as farmers preferred to have other crop against Jeera. Weather in key sowing area will be crucial in next few months. In Unjha, a key spot market in Gujarat, jeera edged down by -19.45 Rupees to end at 16091.65 Rupees per 100 kg.Technically market is under fresh selling as market has witnessed gain in open interest by 0.76% to settled at 7938 while prices down -25 rupees, now Jeera is getting support at 16110 and below same could see a test of 16050 levels, and resistance is now likely to be seen at 16235, a move above could see prices testing 16300.

Trading Ideas:

* Jeera trading range for the day is 16050-16300.
* Jeera prices dropped as better arrivals are expected in the spot market as the cumin production area in Gujarat is increasing rapidly.
* Further adequate stock with traders and farmers may keeping prices under pressure at higher levels.
* Cumin exports declined by 1.4% year-on-year to 1.39 lakh tonnes in April-September.
* In Unjha, a key spot market in Gujarat, jeera edged down by -19.45 Rupees to end at 16091.65 Rupees per 100 kg.

Cotton

Cotton yesterday settled up by 1.06% at 33310 due to production concerns and higher demand for raw cotton for export. However upside seen limited on expectations of lower demand for garments due to the resurgence of new Omicron coronavirus variant, higher supply, and as higher prices are hurting demand for supplies from top shipper US. Further, demand is muted in top producer India as fabrics manufacturers were hesitant for new purchases due to the proposed hike in taxes from January 1. Meanwhile, the USDA in its December report estimated 2021/22 global production to drop by 200,000 bales as a 1.0 million bale drop in Pakistan more than offsets gains in Benin, Turkey, Uzbekistan, and Cameroon. Also, world cotton ending stocks were projected 1.2 million bales lower due to lower beginning stocks, smaller production and slightly higher consumption. Mali's cotton harvest for the 2021/22 season is expected to be 731,000 tonnes, 10% below an earlier forecast due to insufficient rain in some areas and localised floods elsewhere, data from the cotton producers' association showed. In March, the government forecast that cotton production would rebound this season to 810,000 tonnes after plunging nearly 80% in 2020/21 to 147,200 tonnes because the pandemic upended demand and farmers went on strike. In spot market, Cotton gained by 310 Rupees to end at 32500 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 15.02% to settled at 6233 while prices up 350 rupees, now Cotton is getting support at 32980 and below same could see a test of 32640 levels, and resistance is now likely to be seen at 33530, a move above could see prices testing 33740.

Trading Ideas:

* Cotton trading range for the day is 32640-33740.
* Cotton gained due to production concerns and higher demand for raw cotton for export.
* Demand is muted as fabrics manufacturers were hesitant for new purchases due to the proposed hike in taxes from January 1.
* The USDA in its December report estimated 2021/22 global production to drop by 200,000 bales
* In spot market, Cotton gained  by 310 Rupees to end at 32500 Rupees.
 

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