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• Gold prices edged up on Friday as US services PMI slumped to 44.4 in December 2022, well below market expectations of 46.8. The latest data signalled the fastest pace of contraction in the service sector for four months

• However, sharp upside was capped on rise in US treasury yields and strong US dollar

• Gold prices are expected to trade with a negative bias for the day amid strong dollar and rise in US treasury yields. Further, Fed officials signalled that bank has to lift borrowing cost higher than expected and keep them there for longer to squeeze elevated inflation out of economy. MCX gold prices are likely to break the key support level of 54,150 to trade in a downward trend towards the level of 53,900 in the coming trading session

• MCX silver prices are expected to take cues from gold prices and continue their downward trend towards 66,500 levels

• Copper prices traded flat on Friday despite ongoing worries that a global recession and rising Covid-19 cases in China would depress economic growth and demand for base metals

• Further, prices were pressurised as US manufacturing PMI fell to 46.2 in December 2022, well below forecasts of 47.7. The reading pointed to the biggest contraction in factory activity since May 2020, driven by subdued demand and a faster fall in output

• Moreover, a rise in copper inventories at LME registered warehouses weighed on copper prices

• Copper prices are expected to trade with a negative bias for the day amid strong dollar and risk aversion in global markets. Further, major central banks have raised policy rates and indicated more hikes were likely, fuelling fears of a global economic slowdown. MCX copper prices are likely to drop further till 697 level

• WTI Crude oil prices slid about 2.50% on fears of a looming recession, after central banks across Europe and North America signalled they will continue to battle inflation aggressively

• However, oil prices erased some losses after officials said the US Energy Department will repurchase 3 million barrels of domestic crude oil for the Strategic Petroleum Reserve, the first purchase since this year's record 180 million-barrel release from the stockpile

• Oil prices are likely to trade with a negative bias for the day amid strong dollar and risk aversion in global markets. Further, investors are worried on demand following interest rates hike by central banks in US, Europe and UK that could slow down their economies. Demand from China remains weak as the economy is coping up with new outbreaks of Covid-19. MCX Crude oil is expected to drop below 6160 level to continue trading in a downward trend towards 6100 level

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