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Gold

Gold yesterday settled up by 0.14% at 59298 as the U.S. economy continues to deal with mixed inflation pressures. U.S. Labor Department said its Producer Price Index (PPI) dropped sharply by 0.3% last month following April's increase of 0.2%. The Fed is widely expected to pause its aggressive tightening cycle after data showed that both consumer and producer inflation cooled more than expected in May. Traders will also keep a close on the Fed's plans for the rest of the year, specially whether Chair Powell will signal a hawkish forward guidance. Turkey sold an additional 63 tonnes of gold in May after a selling spree of nearly 100 tonnes in April and March. The latest World Gold Council's (WGC) data showed that the Central Bank of Turkey offloaded 63 tonnes of gold last month. During the spring months, Turkey's official gold reserves dropped by 159 tonnes to 428 tonnes. During the first quarter, central banks added 228 tonnes to their global gold reserves, marking a record pace for the first three months of the year since data collection began in 2000, according to the WGC. However, allocations were down 45% from Q4 2022 figures and marked a second consecutive quarter of declines. Technically market is under short covering as the market has witnessed a drop in open interest by -2.62% to settle at 13552 while prices are up 80 rupees, now Gold is getting support at 59143 and below same could see a test of 58987 levels, and resistance is now likely to be seen at 59460, a move above could see prices testing 59621.

Trading Ideas:
* Gold trading range for the day is 58987-59621.
* Gold steadied as the U.S. economy continues to deal with mixed inflation pressures
* U.S. PPI dropped sharply by 0.3% last month following April's increase of 0.2%.
* Turkey sold an additional 63 tonnes of gold in May

Silver

Silver yesterday settled up by 0.77% at 72651 benefiting from a slightly dollar weakness, as traders await the Fed's interest rate decision. Data showed US producer prices fell more than expected last month, confirming inflationary pressures continue to slow. Yesterday, the CPI report showed the headline inflation eased more than anticipated to 4%, while the core gauge met forecasts at 5.3%. Producer prices for final demand in the US decreased 0.3% month-over-month in May of 2023, following a 0.2% rise in April, and compared to market forecasts of a 0.1% drop. Goods prices went down 1.6%, the largest decrease since July 2022, mainly due to a 13.8% drop in gasoline prices and a 1.3% fall in food. According to the monthly GDP report, the UK economy expanded by 0.2% in April, with notable contributions from the retail sector and the film industry. Furthermore, stronger-than-anticipated inflation and employment figures added pressure on the Bank of England to consider additional interest rate hikes in response to persistent price pressures. Regulatory changes in Mexico will make it harder for mining giants to be rewarded mineral concessions, threatening companies to reduce investments in new projects and jeopardizing output from the world’s top producer. Additionally, silver production out of Peru contracted by 7% year-on-year in the first four months of 2023. Technically market is under fresh buying as the market has witnessed a gain in open interest by 0.76% to settle at 14025 while prices are up 557 rupees, now Silver is getting support at 72320 and below same could see a test of 71990 levels, and resistance is now likely to be seen at 72880, a move above could see prices testing 73110.

Trading Ideas:
* Silver trading range for the day is 71990-73110.
* Silver gains benefiting from a slightly dollar weakness.
* US producer prices fell more than expected last month, confirming inflationary pressures continue to slow
* The CPI report showed the headline inflation eased more than anticipated to 4%.

Crude oil

Crude oil yesterday settled down by -1.13% at 5664 as U.S. crude oil stockpiles posted a surprise large build last week, while gasoline and distillate inventories gained more than expected. The U.S. is planning to buy about 12 million barrels of oil in 2023, including 3 million barrels already scheduled for delivery in August and an additional 3 million barrels from a solicitation the government issued. Stocks of crude oil in the US rose 1.024 by million barrels in the week ended June 9th, 2023, after a 1.710 million barrels drop in the previous week and compared to market expectations of a 1.29 million barrel decline, data from the API's Weekly Statistical Bulletin showed. The boost to oil demand growth from the post-pandemic recovery is set to end this year, the International Energy Agency (IEA) said, with economic challenges and the transition to cleaner fuels sapping growth from 2024. "The shift to a clean energy economy is picking up pace, with a peak in global oil demand in sight before the end of this decade as electric vehicles, energy efficiency and other technologies advance,” said IEA Executive Director Fatih Birol. Global oil demand will grow by 2.4 million barrels per day (bpd) in 2023 to a record 102.3 million bpd, the IEA said in its monthly report. Technically market is under long liquidation as the market has witnessed a drop in open interest by -10.33% to settle at 6865 while prices are down -65 rupees, now Crude oil is getting support at 5599 and below same could see a test of 5535 levels, and resistance is now likely to be seen at 5758, a move above could see prices testing 5853.

Trading Ideas:
* Crude oil trading range for the day is 5535-5853.
* Crude oil dropped as U.S. crude oil stockpiles posted a surprise large build last week
* US plans to purchase 12 mln barrels of oil for reserve this year
* Economic outlook and energy transition to curb oil demand growth from 2024

Natural Gas

Nat.Gas yesterday settled up by 0.26% at 193.1 as natural gas production in North Dakota rose to 3.117 billion cubic feet per day (bcfd) in April from 3.053 bcfd in March, while the amount of gas flared eased. Monthly production in the state hit an all-time high of 3.180 bcfd in September 2022. Data provider Refinitiv said average gas output in the U.S. Lower 48 states slid to 102.0 billion cubic feet per day (bcfd) so far in June, down from a monthly record of 102.5 bcfd in May. On a daily basis, output over the past couple of days was on track to plunge 2.9 bcfd to a preliminary four-month low of 99.5 bcfd on Tuesday. Analysts, however, noted preliminary data is often revised later in the day. Meteorologists again pushed back the start of a late June heat wave to June 23 from a previously expected June 21. Last week, meteorologists expected the weather to turn hotter than normal around June 15. With warmer weather coming, Refinitiv forecast U.S. gas demand, including exports, would rise from 92.9 bcfd this week to 96.2 bcfd next week. Those forecasts, however, were lower than Refinitiv's outlook on Tuesday due in part to the later expected start of the heat wave in late June. Technically market is under fresh buying as the market has witnessed a gain in open interest by 3.7% to settle at 35383 while prices are up 0.5 rupees, now Natural gas is getting support at 190 and below same could see a test of 186.8 levels, and resistance is now likely to be seen at 196.4, a move above could see prices testing 199.6.
 

Trading Ideas:
* Natural gas trading range for the day is 186.8-199.6.
* Natural gas dropped as North Dakota monthly natgas output rises in April
* An anticipated heatwave from June 21-28 is likely to boost demand for gas to produce power for air conditioning.
* US output is falling from May's record level of 102.5 bcfd.


Copper

Copper yesterday settled up by 0.47% at 731.85 as in China, refined copper output declined month-on-month in May because of smelters' maintenance. That, coupled with lower imports due to unfavorable market conditions, raised concerns of further supply tightness. Major market players continued to flag worries that copper supply may not keep up with expectations of strong long-term demand, since the metal is a critical raw material for the transition to renewable resources. The PBoC cut short-term borrowing costs to improve property developers’ liquidity. On the supply side, copper inventories at the London Metals Exchange were under 72 thousand tonnes in June, the lowest in one month. Also, Chile said this year's output is estimated to sink as much as 7% after the 10.6% decline in 2022. Boliden's copper smelter in Ronnskar in Sweden, the company's biggest production unit, was damaged in a fire and has halted all production, the Swedish metals group said. A conveyer belt at Chile's Escondida copper mine, will face a partial 100-hour pause due to a fire, an Escondida union source told. The global refined copper market had a 2,000 tonne surplus in March, compared with a 196,000 tonne surplus the previous month, the International Copper Study Group (ICSG) said in its latest monthly bulletin. Technically market is under short covering as the market has witnessed a drop in open interest by -2.87% to settle at 5345 while prices are up 3.4 rupees, now Copper is getting support at 727.8 and below same could see a test of 723.6 levels, and resistance is now likely to be seen at 734.3, a move above could see prices testing 736.6.

Trading Ideas:
* Copper trading range for the day is 723.6-736.6.
* Copper gains as in China, refined copper output declined in May
* Copper inventories at the LME were under 72 thousand tonnes in June, the lowest in one month.
* Chile said this year's output is estimated to sink as much as 7% after the 10.6% decline in 2022.

Zinc

Zinc yesterday settled up by 2.82% at 220.95 with the demand outlook buoyed by China's latest economic support. China's central bank lowered its seven-day reverse repo rate for the first time since August, in a move that typically signals potential changes in longer-term rates, to restore market confidence and prop up a stalling post-pandemic recovery. Chinese refined zinc output stood at 564,500 mt in May, an increase of 24,500 mt or 4.54% MoM and 9.56% YoY, slightly exceeding expectations. China will likely further cut banks' reserve ratio and interest rates in the second half of this year to support the economy. Investors also hoped that Beijing would roll out supportive measures soon to bolster the embattled property sector, which consumes a vast amount of metals. Some smelters in Henan reduced production due to high sulphuric acid inventories. Zinc inventories in London Metal Exchange-registered warehouses have nearly doubled since last week to a one-year peak after a shipment arrived in Malaysia, data published by the exchange showed. The global zinc market surplus climbed to 26,700 tonnes in March, from a surplus of 22,800 tonnes a month earlier, data from the International Lead and Zinc Study Group (ILZSG) showed. During the first three months of 2023, ILZSG data showed a surplus of 49,000 tonnes, versus a surplus of 116,000 tonnes in the same period of 2022. Technically market is under short covering as the market has witnessed a drop in open interest by -9.83% to settle at 2514 while prices are up 6.05 rupees, now Zinc is getting support at 217.6 and below same could see a test of 214.2 levels, and resistance is now likely to be seen at 222.9, a move above could see prices testing 224.8.

Trading Ideas:
* Zinc trading range for the day is 214.2-224.8.
* Zinc gains with the demand outlook buoyed by China's latest economic support.
* China will likely further cut banks' reserve ratio and interest rates in the second half of this year to support the economy.
* Some smelters in Henan reduced production due to high sulphuric acid inventories.


Aluminium

Aluminium yesterday settled up by 0.39% at 204.85 on China's decision to cut borrowing cost for the first time in 10 months to prop up its economic growth. The market kept a close eye on rain forecast in China's main aluminium producing region Yunnan, where reduced hydropower generation kept part of the metal production capacity offline for months. Hydropower generation in Yunnan has improved, and a small amount of aluminium capacity there could resume in late June. Investor sentiment was aided by China's financial boost and its decision to launch a nationwide campaign to promote automobile purchases and shore up demand in the world's largest auto market. China's economic growth is expected to be "relatively high" in the second quarter compared to the prior year, mainly due a low base of comparison, while consumer inflation is projected to be above 1% by December, the central bank governor said. As rising interests’ rates and inflation squeeze demand in the United States and Europe, China's core CPI has been soft and factory gate prices fell sharply in May, suggesting the world's second-largest economy is losing steam. At present, China's economy is recovering from the impact of COVID-19, and the balance sheets of its companies are being repaired, PBOC said in a statement. Technically market is under short covering as the market has witnessed a drop in open interest by -2.43% to settle at 3126 while prices are up 0.8 rupees, now Aluminium is getting support at 204.4 and below same could see a test of 203.8 levels, and resistance is now likely to be seen at 205.4, a move above could see prices testing 205.8.

Trading Ideas:
* Aluminium trading range for the day is 203.8-205.8.
* Aluminium gains on China's decision to cut borrowing cost
* Investor sentiment was aided by China's financial boost
* China's central bank upbeat on Q2 GDP growth, confident on 2023 targets

Mentha oil

Mentha oil yesterday settled down by -0.4% at 921.1 on better sowing prospects. Reports of increased acreages and sluggish export of menthol will weigh on prices. Rising menthol imports, as well as China's limited purchasing, will put pressure on pricing. Mentha exports during Apr 2023, dropped by 42.52 percent to 97.85 tonnes as compared to 170.22 tonnes exported during Apr 2022. In April 2023 around 97.85 tonnes of Mentha was exported as against 202.95 tonnes in March 2023 showing a drop of 51.78%. 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 Sambhal spot market, Mentha oil dropped by -29.1 Rupees to end at 1053.9 Rupees per 360 kgs.Technically market is under long liquidation as the market has witnessed a drop in open interest by -2.32% to settle at 631 while prices are down -3.7 rupees, now Mentha oil is getting support at 914 and below same could see a test of 907 levels, and resistance is now likely to be seen at 927, a move above could see prices testing 933.

Trading Ideas:
* Mentha oil trading range for the day is 907-933.
* In Sambhal spot market, Mentha oil dropped  by -29.1 Rupees to end at 1053.9 Rupees per 360 kgs.
* Mentha oil prices dropped on better sowing prospects.
* Reports of increased acreages and sluggish export of menthol will weigh on prices.
* Rising menthol imports, as well as China's limited purchasing, will put pressure on pricing.

Turmeric

Turmeric yesterday settled up by 5.99% at 8386 amid firm demand and lower sowing prospects in India, with delayed sowing in many regions. Turmeric's kharif sowing acreage is anticipated to decrease by 20-25% this season as farmers opt for other crops. Crop arrivals for the week ending June 10, 2023, were significantly lower at 3,731.85 MT, down 55% from the previous week. Support also seen as the untimely rains that occurred in various places in the Andhra Pradesh damaged turmeric crops causing huge loss to the farmers. In Maharashtra, Andhra Pradesh, and Telangana, farmers are awaiting rainfall before starting field preparation and sowing, which will commence after receiving two to three monsoon showers. Turmeric exports during Apr 2023, rose by 42.32 percent at 19,590.87 tonnes as compared to 13,765.03 tonnes exported during Apr 2022. In April 2023 around 19,590.87 tonnes of turmeric was exported as against 18,810.47 tonnes in March 2023 showing a rise of 4.15%. 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 7652.75 Rupees gained 208.6 Rupees.Technically market is under fresh buying as the market has witnessed a gain in open interest by 5.86% to settle at while prices are up 474 rupees, now Turmeric is getting support at 8074 and below same could see a test of 7764 levels, and resistance is now likely to be seen at 8540, a move above could see prices testing 8696.

Trading Ideas:
* Turmeric trading range for the day is 7764-8696.
* Turmeric rose amid firm demand and lower sowing prospects in India
* Support also seen as the untimely rains that occurred in various places in the Andhra Pradesh damaged turmeric crops.
* Supplies in Maharashtra and Telangana are likely to increase as farmers are getting fair realization on their produce.
* In Nizamabad, a major spot market in AP, the price ended at 7652.75 Rupees gained 208.6 Rupees.

Jeera

Jeera yesterday settled up by 0.7% at 49885 due to good export demand and expectations of lower stocks end of the current marketing year. Prices rose on crop worries grow due to unseasonal rains and hailstorms in Rajasthan, the major producing state. The market is expecting a lower yield and quality of jeera this season, which has boosted the demand from domestic and export buyers. The jeera growing regions in southern and north-western parts of Rajasthan in the districts of Alwar, Jaisalmer, Jaipur, Bikaner, Bhilwara, and Barmer have received a fresh spell of unseasonal rains in the past week, triggering concerns on the crop condition. Marginal traders are avoiding bulk buying in anticipation of rise in seasonal supply of jeera in Gujarat and Rajasthan. Below normal supplies in the market supported firmness in prices. About 508 tonnes of jeera arrived on 6th June at major APMC mandis across India as compared to 653 tonnes of prior day. Tighter carryover stocks and lower production will push up the prices further. According to FISS forecasts, cumin demand is predicted to exceed 85 lakh bags this year, with a likely supply of 65 lakh bags. One bag holds 55kg. This will result in a demand-supply imbalance. Currently, at least 70% of the crop in Rajasthan and around 30% in Gujarat have yet to be harvested. Because of the rain in both states, the total yield will be reduced. The cumin crop was destroyed by two bouts of unseasonal rainfall during the harvest season. In comparison to the planned arrival of 70 lakh bags, the stock will be reduced to 60-65 lakh bags, with a carry-forward stock of 5 lakh bags from last year. In Unjha, a key spot market in Gujarat, jeera edged up by 349.9 Rupees to end at 49237.65 Rupees per 100 kg.Technically market is under fresh buying as the market has witnessed a gain in open interest by 5.1% to settle at while prices are up 345 rupees, now Jeera is getting support at 49270 and below same could see a test of 48660 levels, and resistance is now likely to be seen at 50370, a move above could see prices testing 50860.

Trading Ideas:
* Jeera trading range for the day is 48660-50860.
* Jeera crosses 50000 level for the first time ever due to good export demand
* Traders are avoiding bulk buying in anticipation of rise in seasonal supply of jeera in Gujarat and Rajasthan.
* The market is expecting a lower yield and quality of jeera this season
* In Unjha, a key spot market in Gujarat, jeera edged up by 349.9 Rupees to end at 49237.65 Rupees per 100 kg.

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