IGI Logo

Gold

Gold yesterday settled up by 0.4% at 51655 as fighting in Ukraine buoyed demand for the safe-haven asset, although strength in U.S. bond yields restricted bullion's gains. The Russian finance ministry announced that it had sent funds to cover $117 million in coupon payments on two dollar-denominated sovereign bonds that came due this week. The payments calmed investor worries that a Russia sovereign default, which would have been its first in a century, could rattle already nervous markets. Western sanctions have hobbled Russia's financial dealings since it invaded Ukraine on Feb. 24. Gold prices edged up as fighting in Ukraine buoyed demand for the safe-haven asset, although strength in U.S. bond yields restricted bullion's gains. Prices also seen supported as fighting in Ukraine raged on with no sign of a ceasefire even as diplomatic efforts continued. Elevated domestic prices dimmed retail appetite for physical gold in India, while a resurgence in COVID-19 cases prompted dealers in China and Hong Kong to offer discounts. Dealers offered discounts of up to $45 an ounce over official domestic prices versus last week's $77 discounts, a near six-year peak. In China, discounts widened to between $4 and $6 an ounce over global benchmark spot rates from $2 to $4 the previous week. Technically market is under short covering as market has witnessed drop in open interest by -3.62% to settled at 7811 while prices up 208 rupees, now Gold is getting support at 51374 and below same could see a test of 51092 levels, and resistance is now likely to be seen at 51914, a move above could see prices testing 52172.
Trading Ideas:
Gold trading range for the day is 51092-52172.
Gold prices gained as fighting in Ukraine buoyed demand for the safe-haven asset
Western sanctions have hobbled Russia's financial dealings since it invaded Ukraine on Feb. 24.
U.S. 10-year Treasury yields firm


Silver

Silver yesterday settled up by 0.7% at 68349 as the Ukraine conflict showed little sign of receding, lifting safe-haven demand for the metal. Ukraine said the country’s forces would not surrender in Mariupol and that it has already informed Russia of its stand, as fighting in the besieged city raged on. Atlanta Fed President Raphael Bostic said he has pencilled in a total of six interest rate hikes this year and two for 2023, fewer than most of his colleagues, on worries about the effects of Russia's invasion on the U.S. economy. Two of the Federal Reserve’s most hawkish policymakers said Friday the central bank needs to take more aggressive steps to combat inflation. Minneapolis Fed President Neel Kashkari said he wants to raise rates to 1.75% to 2% this year, according to an essay published on the regional Fed bank's website. Higher interest rates raise the opportunity cost of holding the non-yielding bullion. The trade balance in the Euro Area swung to a €27.2 billion deficit in January of 2022 from a €10.7 billion surplus a year earlier. It is a record high trade gap as imports jumped 44.3% to €226.7 billion, driven by a surge in energy purchases. Exports increased at a softer 18.9% to €199.5 billion. Technically market is under fresh buying as market has witnessed gain in open interest by 4.06% to settled at 6171 while prices up 473 rupees, now Silver is getting support at 67957 and below same could see a test of 67564 levels, and resistance is now likely to be seen at 68694, a move above could see prices testing 69038.
Trading Ideas:
Silver trading range for the day is 67564-69038.
Silver gains as the Ukraine conflict showed little sign of receding, lifting safe-haven demand for the metal.
Ukraine said the country’s forces would not surrender in Mariupol and that it has already informed Russia of its stand
Fed’s Bostic said he has pencilled in a total of six interest rate hikes this year and two for 2023


Crude oil

Crude oil yesterday settled up by 5.94% at 8331 as the Ukraine conflict showed little sign of easing, while major oil producers struggled to meet their allotted quotas under a supply agreement. Russia's oil and gas condensate production rose to 11.11 mln barrels per day (bpd) between March 1 and March 20, from an average output of 11.06 bpd recorded last month. Russian Deputy Prime Minister Alexander Novak said on Monday that oil prices could reach $300 a barrel if Russian crude was shunned by the West, although he said that was unlikely. Novak also said it was impossible for Europe to refuse Russian oil and gas for now. Saudi Arabia's crude oil exports in January rose to 6.996 million barrels per day (bpd), the highest level since April 2020, official data showed. Crude oil exports in January rose 0.9% from the 6.937 million bpd reported for December, data showed. The world's largest oil exporter's crude output rose by 0.123 million bpd month on month to 10.145 million bpd in January, also the highest since April 2020. Saudi Arabia, along with OPEC, is trying to steadily ramp up output every month as global oil demand rises on the back of a recovery from the COVID-19 pandemic. Saudi Arabia's domestic crude refinery throughput rose 0.083 million bpd to 2.777 million bpd in January while direct crude burn rose 84,000 bpd to 402,000 bpd. Technically market is under fresh buying as market has witnessed gain in open interest by 35.25% to settled at 7229 while prices up 467 rupees, now Crude oil is getting support at 8022 and below same could see a test of 7712 levels, and resistance is now likely to be seen at 8520, a move above could see prices testing 8708.
Trading Ideas:
Crude oil trading range for the day is 7712-8708.
Crude oil gained as the Ukraine conflict showed little sign of easing, while major oil producers struggled to meet their allotted quotas.
Russia's oil and gas condensate output rises to 11.11 mln bpd over March 1 – 20
Novak says oil may hit $300 a barrel if Russian crude shunned


Nat.Gas

Nat.Gas yesterday settled up by 0.3% at 371.2 as the market focused more on rising oil prices than on higher gas output and forecasts for milder weather and lower heating demand next week than previously expected. Meteorologists forecast weather in the United States would remain milder than normal through at least early April, which should keep heating demand low and allow utilities to start injecting gas into storage this week about a week earlier than usual. Data provider Refinitiv said average gas output in the U.S. Lower 48 states was on track to rise to 93.2 bcfd in March from 92.5 bcfd in February as more oil and gas wells return to service after freezing earlier in the year. That compares with a monthly record of 96.2 bcfd in December. With the coming of slightly cooler weather next week, Refinitiv projected average U.S. gas demand, including exports, would rise from 96.7 bcfd this week to 97.6 bcfd next week. The forecast for next week, however, was lower than Refinitiv's outlook on Friday. The amount of gas flowing to U.S. LNG export plants rose to 12.82 bcfd so far in March from 12.43 bcfd in February and a record 12.44 bcfd in January. The United States has the capacity to turn about 12.7 bcfd of gas into LNG. The rest of the gas flowing to the plants is used to operate the facilities. Technically market is under short covering as market has witnessed drop in open interest by -12.45% to settled at 4641 while prices up 1.1 rupees, now Natural gas is getting support at 362.8 and below same could see a test of 354.5 levels, and resistance is now likely to be seen at 378.7, a move above could see prices testing 386.3.
Trading Ideas:
Natural gas trading range for the day is 354.5-386.3.
Natural gas edged up as the market focused more on rising oil prices than on higher gas output and forecasts for milder weather
Meteorologists forecast weather in the United States would remain milder than normal through at least early April
EIA said utilities pulled 79 billion cubic feet (bcf) of gas from storage during the week ended March 11.



Copper

Copper yesterday settled down by -0.2% at 814.4 as the COVID-19 pandemic situation was still severe in China, which kept influencing domestic transportation and transactions of spots. China released a series a macro economic data, and all of which are slightly better than expected. The value added of industries above the scale increased by 7.5% year-on-year, total retail sales of consumer goods rose by 6.7% YoY, and fixed asset investment added 12.2% YoY, among which the investment concerning manufacturing, infrastructure and real estate investment grew 20.9%, 8.1% and 3.7% YoY respectively. The People's Bank of China maintained its benchmark interest rates for corporate and household loans at its March fixing, as widely expected. The one-year loan prime rate (LPR) was kept unchanged at 3.7 percent following cuts of 5 and 10 basis points in December and January, respectively; while the five-year rate was retained at 4.6 percent after a 5-basis-point cut in January. Last week, the central bank kept the rate on CNY 200 billion worth of one-year medium-term lending facility (MLF) loans to some financial institutions unchanged at 2.85% from the previous operation. The Chinese central recently reaffirmed its commitment to stay accommodative and increase its support for key areas and weak links in the economy, amid volatile internal and external conditions that would require more counter-cyclical policy adjustment. Technically market is under long liquidation as market has witnessed drop in open interest by -6.11% to settled at 2876 while prices down -1.65 rupees, now Copper is getting support at 808.7 and below same could see a test of 802.9 levels, and resistance is now likely to be seen at 818.6, a move above could see prices testing 822.7.
Trading Ideas:
Copper trading range for the day is 802.9-822.7.
Copper remained in range as the COVID-19 pandemic situation was still severe in China, which kept influencing domestic transportation
China released a series a macro economic data, and all of which are slightly better than expected.
The People's Bank of China maintained its benchmark interest rates for corporate and household loans at its March fixing


Zinc

Zinc yesterday settled up by 2.22% at 327 as China’s output of refined zinc dropped 1.8% YoY to 1.06 million mt. Domestic zinc ingot inventory across seven major markets in China totalled 276,900 mt as of Monday March 21, up 700 from last Friday March 18 and down 8,800 mt from last Monday March 14. The inventory dropped mainly due to hindered transportation. CHINA released a series a macro economic data, and all of which are slightly better than expected. The value added of industries above the scale increased by 7.5% year-on-year, total retail sales of consumer goods rose by 6.7% YoY, and fixed asset investment added 12.2% YoY, among which the investment concerning manufacturing, infrastructure and real estate investment grew 20.9%, 8.1% and 3.7% YoY respectively. The manufacturing sector improved significantly, which benefited palpably from the export market. Meanwhile, thanks to financial support, the growth in the infrastructure sector was obvious. The Financial Stability Development Committee of the State Council released a strong signal to stabilise the economy, finance, housing finance and stock market, and market confidence was significantly boosted. Technically market is under fresh buying as market has witnessed gain in open interest by 2.93% to settled at 807 while prices up 7.1 rupees, now Zinc is getting support at 322 and below same could see a test of 316.8 levels, and resistance is now likely to be seen at 330.4, a move above could see prices testing 333.6.
Trading Ideas:
Zinc trading range for the day is 316.8-333.6.
Zinc gained as support seen as China’s output of refined zinc dropped 1.8% YoY to 1.06 million mt.
China released a series a macro economic data, and all of which are slightly better than expected.
The value added of industries above the scale increased by 7.5% year-on-year, total retail sales of consumer goods rose by 6.7% YoY


Nickel

Nickel yesterday settled down by -10.33% at 2201.5 as participants continue to sell the metal while volumes remain low. The 15% limit within which nickel can trade on either side of Friday’s closing price is wider than the previous 12%. Western sanctions against Russia over its invasion of Ukraine sparked concerns over the metal supply and supercharged existing upward momentum in the market. Earlier this month, prices briefly topped the $100,000 mark amid a vicious short squeeze as China’s Tsingshan Holding Group, one of the world’s top producers, bought large amounts to reduce its short bets on the metal. The physical market, which is made up of end-users and producers, use LME settlement prices as a reference for their contracts to buy and sell nickel. The disorderly LME market has left some traders questioning whether participants might look for alternative venues. The rapid rise in prices caught out some large players who were betting on a decline in nickel prices. To cut their positions and limit their losses, they bought large amounts of the metal last week, triggering the spike above $100,000 a tonne. Technically market is under fresh selling as market has witnessed gain in open interest by 3.12% to settled at 264 while prices down -253.5 rupees, now Nickel is getting support at 2096 and below same could see a test of 1990.6 levels, and resistance is now likely to be seen at 2331.8, a move above could see prices testing 2462.2.
Trading Ideas:
Nickel trading range for the day is 1990.6-2462.2.
Nickel fell as participants continue to sell the metal while volumes remain low.
China’s Tsingshan Holding Group, one of the world’s top producers, bought large amounts to reduce its short bets on the metal.
The rapid rise in prices caught out some large players who were betting on a decline in nickel prices.


Aluminium

Aluminium yesterday settled up by 3.07% at 280.55 as supply risks lingered with talks between Russia and Ukraine showing no signs of material progress, while market sentiment was also buoyed by hopes of more economic support in top consumer China. On the macro front, the US Federal Reserve decided to raise the target range of the federal funds rate by 25 basis points at its second interest rate meeting of the year on March 16, which is the first interest rate hike since the start of the interest rate cut cycle in July 2019. As the pace of medium and long-term interest rate hike is hawkish, the US stock market collapsed after the policy meeting. The National Bureau of Statistics released the Chinese economic data for January-February 2022, which topped market expectations and pointed to strong supply and demand. The investment picked up significantly, and the domestic demand recovered faster than expected. The operating aluminium capacity in China increased slightly due to production resumption in Yunnan and other regions, but the total output was still lower than in the same period last year. The COVID-19 in China spread on a wide scale and fast speed, causing disruptions to the domestic transportation. The pandemic has not yet triggered output reduction or suspension at the domestic aluminium smelters, but severely hindered the transportation of upstream and downstream enterprises, reducing arrivals across the consumption hubs. Technically market is under short covering as market has witnessed drop in open interest by -1.73% to settled at 2158 while prices up 8.35 rupees, now Aluminium is getting support at 274.6 and below same could see a test of 268.5 levels, and resistance is now likely to be seen at 285.2, a move above could see prices testing 289.7.
Trading Ideas:
Aluminium trading range for the day is 268.5-289.7.
Aluminium prices edged higher as supply risks lingered with talks between Russia and Ukraine showing no signs of material progress
Chinese economic data for January-February 2022, which topped market expectations and pointed to strong supply and demand.
The operating aluminium capacity in China increased slightly due to production resumption in Yunnan and other regions


Mentha oil

Mentha oil yesterday settled up by 2.08% at 1057.5 as this time the farmers are planting less mentha crop due to lack of water. Farmers have started buying Mentha roots for sowing Mentha in their fields. However, upside seen limited as the war between Ukraine and Russia having a bad impact on prices. There is a demand for Mentha of about 200 crores in Russia and Ukraine. For this reason, the mentha traders are also worried about the fight between these two countries. Mentha worth six thousand crores is exported every year from all over the country. India is the largest producer and exporter of Mentha Oil and its derivatives. Every year about 20 thousand tons of mentha oil and related products are exported from here to America, China, Europe and South America. Fragrance Market in U.A.E. to Grow at 8.3% CAGR Through 2030, says P&S Intelligence. During the COVID-19 pandemic, the U.A.E. fragrance market was negatively affected. The production of non-essential goods was curtailed, while people were also forced inside their homes. The resulting slump in business, media & entertainment, and social activities reduced the demand for fragrances in the country. In Sambhal spot market, Mentha oil gained by 28.1 Rupees to end at 1165.5 Rupees per 360 kgs.Technically market is under short covering as market has witnessed drop in open interest by -14.75% to settled at 630 while prices up 21.5 rupees, now Mentha oil is getting support at 1037.4 and below same could see a test of 1017.2 levels, and resistance is now likely to be seen at 1086.4, a move above could see prices testing 1115.2.
Trading Ideas:
Mentha oil trading range for the day is 1017.2-1115.2.
In Sambhal spot market, Mentha oil gained  by 28.1 Rupees to end at 1165.5 Rupees per 360 kgs.
Mentha oil settled firm as this time the farmers are planting less mentha crop due to lack of water.
Farmers have started buying Mentha roots for sowing Mentha in their fields.
However, upside seen limited as the war between Ukraine and Russia having a bad impact on prices.


Turmeric

Turmeric yesterday settled down by -1.48% at 8530 as new season turmeric is arriving in the market and exports are normal this season. In the first 9 months (April-December) of FY 2021-22, exports declined by 20.7% over the previous year to 1,16,400 tonnes, but 8.8% higher than the 5-year average. The arrival of the new crop has started in the markets of Telangana and Maharashtra. Pressure also seen due to tensions between Ukraine and Russia which may disrupt shipments of spices to Europe and other destinations. Turmeric crop was damaged in Maharashtra, Nizamabad in Telangana and Kadapa in Andhra Pradesh due to rains and cyclones. The farmers, who incurred losses during this period due to low price, are hoping to get good price this year, so that they could clear their dues to some extent. 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. 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 Nizamabad, a major spot market in AP, the price ended at 8675 Rupees dropped -145 Rupees.Technically market is under fresh selling as market has witnessed gain in open interest by 1.12% to settled at 13070 while prices down -128 rupees, now Turmeric is getting support at 8466 and below same could see a test of 8400 levels, and resistance is now likely to be seen at 8604, a move above could see prices testing 8676.
Trading Ideas:
Turmeric trading range for the day is 8400-8676.
Turmeric dropped as new season turmeric is arriving in the market and exports are normal this season.
Turmeric crop was damaged in Maharashtra, Nizamabad in Telangana and Kadapa in Andhra
In the first 9 months (April-December) of FY 2021-22, exports declined by 20.7% over the previous year to 1,16,400 tonnes.
 In Nizamabad, a major spot market in AP, the price ended at 8675 Rupees dropped -145 Rupees.


Jeera

Jeera yesterday settled down by -0.17% at 20780 as the export of cumin in April-January declined by 23% year-on-year to 1.88 lakh tonnes as compared to 2.44 lakh tonnes in the previous year. Pressure also seen due to tensions between Ukraine and Russia which may disrupt shipments of spices to Europe and other destinations. There were reports of decline in sowing area and improving domestic demand. In 2021-22, the area under cumin in Gujarat is only 3.07 lakh hectares as compared to 4.69 lakh hectares in the same period last year and production is expected to decline by 41% to 2.37 lakh tonnes as compared to last year's 4 lakh tonnes as per second advance estimates. The area under jeera has decreased by about 30% in Rajasthan this year, to 5.39 lakh hectares (lh) from 7.7 lh last year, Spices Board officials confirmed. According to the data released by the commerce department, cumin exports in January 2022 increased by 19% to 14,725 tonnes as compared to 12,385 tonnes in December 2021. Carry-forward stocks would be approximately 25 lakh bags. Last year's jeera crop was 93 lakh bags, with a carryover stock of 20 lakh bags. The decline in the jeera area is more pronounced in Rajasthan, where farmers have shifted to mustard because prices for the oilseed crop were favourable during the sowing season. In Unjha, a key spot market in Gujarat, jeera edged up by 132.75 Rupees to end at 20668.75 Rupees per 100 kg.Technically market is under long liquidation as market has witnessed drop in open interest by -1.67% to settled at 11838 while prices down -35 rupees, now Jeera is getting support at 20635 and below same could see a test of 20495 levels, and resistance is now likely to be seen at 20935, a move above could see prices testing 21095.
Trading Ideas:
Jeera trading range for the day is 20495-21095.
Jeera dropped as export of cumin in April-January declined by 23% year-on-year to 1.88 lakh tonnes
However, there were reports of decline in sowing area and improving domestic demand.
Pressure also seen due to tensions between Ukraine and Russia which may disrupt shipments of spices to Europe and other destinations.
In Unjha, a key spot market in Gujarat, jeera edged up by 132.75 Rupees to end at 20668.75 Rupees per 100 kg.


Cotton

Cotton yesterday settled up by 2.83% at 40320 amid strong demand and possible lower supplies. USDA’s weekly export sales data showed that cotton shipments reached 96% of the USDA’s marketing year estimates to 371,400 bales, which is also 5% more than that of the previous week and 34% higher from the prior 4-week average. At the same time, concerns grew over the drought conditions in West Texas on the back of lower than normal precipitation forecasts for the area. Also, USDA in its March 10th report estimated 2021/22 global cotton consumption to be 111,000 bales higher compared to last month’s projections while it sees world ending stocks 1.7 million bales lower due to smaller global production, particularly from India. Cotton production at 340.63 lakh bales for this season (October 2021-September 2022) against 352.48 lakh bales last season, as per second advance estimate, the Union Ministry for Agriculture and Farmers WelfareLast month, the Cotton Association of India (CAI), a body of traders, cut its crop estimates to 343.13 lakh bales from its earlier projection of 348.13 lakh bales. Speculators reduced their net long position in cotton futures on ICE U.S. in the week to March 15, data from the Commodity Futures Trading Commission (CFTC) showed. In spot market, Cotton gained by 1390 Rupees to end at 39450 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -18.22% to settled at 3994 while prices up 1110 rupees, now Cotton is getting support at 39740 and below same could see a test of 39150 levels, and resistance is now likely to be seen at 40660, a move above could see prices testing 40990.
Trading Ideas:
Cotton trading range for the day is 39150-40990.
Cotton rose amid strong demand and possible lower supplies.
USDA’s weekly export sales data showed that cotton shipments reached 96% of the USDA’s marketing year estimates to 371,400 bales
Speculators reduced their net long position in cotton futures
In spot market, Cotton gained  by 1390 Rupees to end at 39450 Rupees.

Views express by all participants are for information & academic purpose only. Kindly read disclaimer before referring below views. Click Here For Disclaimer