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Gold

Gold yesterday settled down by -0.09% at 51005 as elevated U.S. Treasury yields dented bullion's appeal and investors brace for US inflation data that could guide the Federal Reserve’s rate hike timeline. ECB said it will raise interest rates by 25bps in July, and left the door open for a more aggressive hike in September should the bloc’s medium-term inflation outlook persist at a high level. To add, the central bank confirmed expectations that it will end quantitative easing via the Asset Purchase Program by the end of June. Also, year-end inflation expectations were revised higher to 6.8% for 2022, and are forecasted to remain above the ECB’s threshold of 2% until the end of 2024. Projections of higher borrowing costs led to even more aggressive bond sell-offs for states with higher debt, with the Italian 10-year BTP jumping 25bps to 3.7%, enough to widen the closely-watched spread with its German counterpart to over levels not seen since May of 2020. Demand for gold will dip this year, mainly due to weaker jewellery sales and retail investment in China due to COVID-19 lockdowns and an economic slowdown, consultants Metals Focus said. Supply of gold, meanwhile, will rise slightly as mines expand production and recycling increases, Metals Focus said in its annual Gold Focus report. Technically market is under long liquidation as market has witnessed drop in open interest by -1.02% to settled at 14212 while prices down -46 rupees, now Gold is getting support at 50829 and below same could see a test of 50652 levels, and resistance is now likely to be seen at 51159, a move above could see prices testing 51312.
Trading Ideas:
* Gold trading range for the day is 50652-51312.
* Gold prices dropped as elevated U.S. Treasury yields dented bullion's appeal
* Investors brace for US inflation data that could guide the Federal Reserve’s rate hike timeline.
* ECB said it will raise interest rates by 25bps in July, and left the door open for a more aggressive hike in September


Silver
Silver yesterday settled down by -0.99% at 61411 as U.S. bond yields edged up and the dollar traded firm as investors fret over the impact of worsening inflation on interest rates, economic growth and corporate earnings. The 10-year US Treasury note yield consolidated above 3%, as investors assessed the outlook for inflation and monetary policy ahead of Friday's highly anticipated May US consumer price data. Inflation is seen above 8%, increasing pressure on the Federal Reserve to stick to aggressive rate hikes. The US Central Bank has raised its benchmark policy rate by half a percentage point for the first time since 2000 in early May while signaling it intended to increase it by the same amount in June. The number of Americans filing new claims for unemployment benefits increased to the highest level in nearly five months last week, but that likely does not mark a material shift in labor market conditions, which remain very tight. The report from the Labor Department also showed unemployment rolls remained at a more than 52-year low at the end of May, underscoring the job market's strength. The Federal Reserve is poised to deliver another 50 basis points interest rate hike next Wednesday as it tries to cool demand, including for labor, in its fight against inflation. Technically market is under fresh selling as market has witnessed gain in open interest by 19.06% to settled at 13900 while prices down -615 rupees, now Silver is getting support at 60814 and below same could see a test of 60216 levels, and resistance is now likely to be seen at 62125, a move above could see prices testing 62838.
Trading Ideas:
* Silver trading range for the day is 60216-62838.
* Silver dropped as U.S. bond yields edged up and the dollar traded firm as investors fret over the impact of worsening inflation on interest rates
* The number of Americans filing new claims for unemployment benefits increased to the highest level in nearly five months last week
* The 10-year US Treasury note yield consolidated above 3%, as investors assessed the outlook for inflation and monetary policy


Crude oil
Crude oil yesterday settled down by -0.54% at 9473 after parts of Shanghai imposed new COVID-19 lockdown measures although China's stronger-than-expected exports in May offered a boost to the demand outlook. China's May exports jumped 16.9% from a year earlier as easing COVID curbs allowed some factories to restart, the fastest growth since January this year and more than double expectations. Parts of Shanghai began imposing new lockdown restrictions, with residents of Minhang district ordered to stay home for two days to control transmission risks. Meanwhile, peak summer gasoline demand in the United States continued to provide a floor to prices. U.S. commercial crude oil inventories rose unexpectedly last week, while crude in the Strategic Petroleum Reserve fell by a record amount as refiners ramped up production to pre-pandemic levels, the Energy Information Administration said. Crude inventories rose by 2 million barrels in the week to June 3 to 416.8 million barrels, compared with expectations for a 1.9 million-barrel drop. SPR crude stocks fell by a record 7.3 million barrels to 519.3 million, their lowest since March 1987. U.S. gasoline stocks unexpectedly dropped, data from the Energy Information Administration (EIA) showed, indicating resilience in demand for the motor fuel during the peak summer period despite sky-high pump prices. Technically market is under long liquidation as market has witnessed drop in open interest by -1.81% to settled at 14085 while prices down -51 rupees, now Crude oil is getting support at 9404 and below same could see a test of 9335 levels, and resistance is now likely to be seen at 9530, a move above could see prices testing 9587.
Trading Ideas:
* Crude oil trading range for the day is 9335-9587.
* Crude oil dropped after parts of Shanghai imposed new COVID-19 lockdown measures
* U.S. gasoline stocks unexpectedly dropped, data from the Energy Information Administration (EIA) showed
* China's May crude oil imports at 45.825m tons


Nat.Gas
Nat.Gas yesterday settled up by 1.01% at 691.3 on record power demand in Texas this week, a smaller-than-usual storage build, rising spot gas prices, low wind power and a decline in gas production so far this month. The fire and explosion that shut the Freeport liquefied natural gas (LNG) export plant in Texas will free up gas to help refill low U.S. stockpiles. Freeport LNG said its export plant in Texas will remain shut for at least three weeks following the explosion, raising the risk of global gas shortages especially in Europe. U.S. natural gas production and demand will both rise in 2022 as the economy grows, the U.S. Energy Information Administration (EIA) said in its Short Term Energy Outlook (STEO). EIA projected that dry gas production will rise to 96.50 billion cubic feet per day (bcfd) in 2022 and 101.57 bcfd in 2023 from a record 93.55 bcfd in 2021. Refinitiv said average gas output in the U.S. Lower 48 states fell to 94.8 billion cubic feet per day (bcfd) so far in June from 95.1 bcfd in May. That compares with a monthly record of 96.1 bcfd in December 2021. The average amount of gas flowing to U.S. LNG export plants fell to 12.4 billion cubic feet per day (bcfd) so far in June from 12.5 bcfd in May, according to data from Refinitiv. Technically market is under short covering as market has witnessed drop in open interest by -5.53% to settled at 5671 while prices up 6.9 rupees, now Natural gas is getting support at 645 and below same could see a test of 598.7 levels, and resistance is now likely to be seen at 717.9, a move above could see prices testing 744.5.
Trading Ideas:
* Natural gas trading range for the day is 598.7-744.5.
* Natural gas gained on record power demand in Texas, a smaller-than-usual storage build, low wind power and a decline in gas production
* Freeport LNG said its export plant in Texas will remain shut for at least three weeks following the explosion, raising the risk of global gas shortages especially in Europe.
* China's May natural gas imports at 9.072m tons



Copper

Copper yesterday settled down by -1.2% at 787.4 weighed down by a stronger dollar, global slowdown concerns and doubts about a demand recovery in top metals consumer China. Parts of Shanghai began imposing new lockdown restrictions, with residents of Minhang district ordered to stay home for two days to control transmission risks. China's May copper imports rose 4.4% from the same month a year earlier, official data showed, as overseas purchases became profitable for Chinese traders and with some COVID lockdowns beginning to lift. China imported 465,495 tonnes of unwrought copper and products last month, up from 445,725 tonnes a year ago, and slightly higher than the 465,330 tonnes in April, according to data from the General Administration of Customs. The slight rise in imports came even after outbreaks of the coronavirus prompted lockdowns for the last two months in Shanghai, China's biggest city and business hub, as well as the northeastern Jilin province, bringing major disruption to the world's No.2 economy. Imports of copper concentrate, or partially processed copper ore, rose to a record 2.19 million tonnes in May, according to the customs data. Chilean state-owned Codelco, said that it stopped its Ventanas smelter and refinery to carry out maintenance after authorities declared an environmental emergency in the region. Technically market is under fresh selling as market has witnessed gain in open interest by 11.15% to settled at 3966 while prices down -9.55 rupees, now Copper is getting support at 783.3 and below same could see a test of 779.2 levels, and resistance is now likely to be seen at 793.4, a move above could see prices testing 799.4.
Trading Ideas:
* Copper trading range for the day is 779.2-799.4.
* Copper prices eased weighed down by a stronger dollar, global slowdown concerns and doubts about a demand recovery in top metals consumer China.
* Parts of Shanghai began imposing new lockdown restrictions
* China May copper imports up 4.4% on year as lockdowns ease


Zinc

Zinc yesterday settled down by -1.48% at 325.15 amid slowing demand and rising output. China's exports grew at a double-digit pace in May, shattering expectations, while imports expanded for the first time in three months as factories resumed production and logistics snags eased after authorities relaxed some of the COVID curbs in Shanghai. The stronger-than-expected headline figures add to encouraging signs that the world's second-largest economy has started to chart a path out of the supply-side shock that has rocked global trade and financial markets in recent months. U.S. wholesale inventories increased slightly more than initially thought in April, suggesting that inventory investment could provide a lift to economic growth this quarter. The rise in stocks reported by the Commerce Department, however, came as sales growth moderated. Inventories are being closely watched amid rising fears of a recession next year as the Federal Reserve raises interest rates to cool demand in its battle against high inflation. The war in Ukraine has made the growth outlook far bleaker even though the global economy should avoid a bout of 1970s-style stagflation, the OECD said, slashing its growth forecasts and jacking up its inflation estimates. The world economy is set to grow 3% this year, much less than the 4.5% expected when the Organisation for Economic Cooperation and Development last updated its forecasts in December. Technically market is under fresh selling as market has witnessed gain in open interest by 12.1% to settled at 1149 while prices down -4.9 rupees, now Zinc is getting support at 321.9 and below same could see a test of 318.7 levels, and resistance is now likely to be seen at 329.5, a move above could see prices testing 333.9.
Trading Ideas:
* Zinc trading range for the day is 318.7-333.9.
* Zinc prices dropped amid slowing demand and rising output.
* China's exports grew at a double-digit pace in May, shattering expectations, while imports expanded for the first time in three months
* OECD slashes growth outlook, but sees limited stagflation risk



Aluminium

"Aluminium yesterday settled down by -2.2% at 233.15 as the market was challenged by rising supply of spot goods after the new capacities started to yield output. Some manufacturers with high in-plant stocks lowered their offers, while a few buyers purchases on dips. The operating alumina capacity of Hebei Wenfeng Alumina Refinery has reached 2.4 million mt, and the output in May has been fully released. In south-west China, the operating capacity of Chongqing Wanbo stands at 3.6 million mt, and is expected to rise by another 1.2 million mt to 4.8 million mt in total, which will significantly heighten the alumina supply in the region. China exported 676,605 tonnes of unwrought aluminium and products last month, the data also showed, the highest volume in at least nine years. On the supply side, domestic aluminium output rose 3.6% YoY in May, indicating that the supply side pressure still exists. On the demand side, the recovering demand has been pulling down the stocks, offering some support to aluminium prices. And aluminium prices are likely to remain rangebound in the near term with the tug-of-war between the longs and shorts. China's exports grew at a double-digit pace in May, shattering expectations, while imports expanded for the first time in three months as factories resumed production and logistics snags eased after authorities relaxed some of the COVID curbs in Shanghai.
Technically market is under fresh selling as market has witnessed gain in open interest by 16.59% to settled at 2979 while prices down -5.25 rupees, now Aluminium is getting support at 230.6 and below same could see a test of 228.1 levels, and resistance is now likely to be seen at 237.7, a move above could see prices testing 242.3."
Trading Ideas:
* Aluminium trading range for the day is 228.1-242.3.
* Aluminium dropped as the market was challenged by rising supply of spot goods after the new capacities started to yield output
* China’s aluminium output rose 3.6% YoY in May, indicating that the supply side pressure still exists.
* China exported 676,605 tonnes of unwrought aluminium and products last month, the data also showed, the highest volume in at least nine years.


Mentha oil

Mentha oil yesterday settled up by 0.38% at 1038.1 amid low production this season and improving demand post-pandemic. Support also seen with Rupee weakness export demand is going to be firm also post pandemic global demand is improving. However, upside seen limited as Synthetic Mentha supply remains uninterrupted. The harvest is expected to be almost the same as last year's in Barabanki area but harvesting this year is expected to be delayed. Crop growth is poor this year compared with last year despite use of fertiliser. The plant is about 25% less than the total crop, water is being felt after every three days. Prices gained on reports that due to poor prices farmers has shifted to other crops resulting lower production. Germany's BASF said it would have to stop production if natural gas supplies fell to less than half its needs, as the world's largest chemicals group warned of the damage to its operations from Europe's power crunch. Mentha farming has lost its allure in Uttar Pradesh as farmers struggle without stable price, MSP and government support. High input costs and lack of support price have drastically brought down the return of farmers who have already been struggling to increase their incomes. In Sambhal spot market, Mentha oil gained by 7.4 Rupees to end at 1162.7 Rupees per 360 kgs.Technically market is under short covering as market has witnessed drop in open interest by -2.58% to settled at 906 while prices up 3.9 rupees, now Mentha oil is getting support at 1033 and below same could see a test of 1027.9 levels, and resistance is now likely to be seen at 1041.5, a move above could see prices testing 1044.9.
Trading Ideas:
* Mentha oil trading range for the day is 1027.9-1044.9.
* In Sambhal spot market, Mentha oil gained  by 7.4 Rupees to end at 1162.7 Rupees per 360 kgs.
* Mentha oil prices seen supported in recent sessions amid low production this season and improving demand post-pandemic.
* Synthetic Mentha supply remains uninterrupted.
* With Rupee weakness export demand is going to be firm also post pandemic global demand is improving.


Turmeric

Turmeric yesterday settled up by 0.22% at 8194 as the arrivals of New season turmeric are diminishing and exports demand is improving as season progresses. Traders and exporters are expecting the prices to remain stable as Maharashtra and Andhra Pradesh turmeric arrivals have also increased. Kocha arrivals are good at markets in Sangli, Hingoli and Nanded regions in Maharashtra. Due to aggressive coverages by oleoresin companies, prices were steady during the month. Panangali arrivals have started in Salem, Erode and Gundalpet markets. Turmeric harvesting in Indonesia is likely to start during June – July 2022. Crop is reported to be normal. Currently, export demand is normal but is expected to pick up. As per latest export figures, turmeric exports in Feb 2022 were lower by 17% y/y at 10400 tonnes vs 12,575 tonnes while in FY 2021/22 (Apr-Feb), exports down 20% at 1.37 lakh tons compared to last year but higher by 8.3% compared with 5-year average. Domestic demand reduced particularly with the new season crop supplies from Marathwada region of Maharashtra during April. Export demand too reported sluggish despite report of some queries from Bangladesh. Turmeric all India production for 2022 is estimated at 4.67 lakh tonnes, revised after crop damage due to excessive rainfall in Maharashtra, Andhra Pradesh and Telangana during October and November. In Nizamabad, a major spot market in AP, the price ended at 8259.55 Rupees gained 55.85 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 15.66% to settled at 10745 while prices up 18 rupees, now Turmeric is getting support at 8144 and below same could see a test of 8092 levels, and resistance is now likely to be seen at 8268, a move above could see prices testing 8340.
Trading Ideas:
* Turmeric trading range for the day is 8092-8340.
* Turmeric prices seen supported as the arrivals of New season turmeric are diminishing and exports demand is improving.
* Traders and exporters are expecting the prices to remain stable as Maharashtra and Andhra Pradesh turmeric arrivals have also increased.
* Turmeric harvesting in Indonesia is likely to start during June – July 2022 and crop is reported to be normal.
* In Nizamabad, a major spot market in AP, the price ended at 8259.55 Rupees gained 55.85 Rupees.


Jeera
Jeera yesterday settled down by -0.89% at 21255 as Cumin exports dropped by 60.58% in March 2022 to around 13406.43 tonnes as against 33203.08 tonnes in March 2021. However downside seen limited because of lower production of the spice in the country, partly because many farmers shifted to more lucrative commodities. On daily basis Jeera arrivals in Unjha market were around 5,000 bags, Saurashtra and Gondal market around 800 t0 1,000 bags are arriving. Similarly, in Rajasthan also daily arrivals have remained weak, in Jodhpur market around 1,500 bags, at Nagaur 500 bags and other centres 500 bags arrivals noted. Currently, steady demand can be seen from Bangladesh and other Islamic countries. And due to Bakri-Eid in July further increase in demand is expected. Demand from China has declined due to higher domestic prices in India. Around 32,407 tonnes and 42,788 tonnes have been exported to Bangladesh and China respectively during 2021-22 (Apr-Feb). Cumin seed exports during the current season are likely to remain low as the current crop is very less this time. Cumin seed exports during 2021-22 (Apr-Feb) has declined by 24 percent at 1.91 lakh tonnes as compared to 2.52 lakh tonnes exported last year same period In Unjha, a key spot market in Gujarat, jeera edged down by -42.6 Rupees to end at 21344.3 Rupees per 100 kg.Technically market is under fresh selling as market has witnessed gain in open interest by 7.47% to settled at 11172 while prices down -190 rupees, now Jeera is getting support at 21105 and below same could see a test of 20960 levels, and resistance is now likely to be seen at 21465, a move above could see prices testing 21680.
Trading Ideas:
* Jeera trading range for the day is 20960-21680.
* Jeera dropped as Cumin exports dropped by 60.58% in March 2022 as compared to March 2021
* However downside sen limited because of lower production of the spice in the country, partly because many farmers shifted to more lucrative commodities.
* Currently, steady demand can be seen from Bangladesh and other Islamic countries. And due to Bakri-Eid in July further increase in demand is expected.
* In Unjha, a key spot market in Gujarat, jeera edged down by -42.6 Rupees to end at 21344.3 Rupees per 100 kg.


Cotton

Cotton yesterday settled up by 1.27% at 46360 as India’s cotton sowing acreage declined 2.35 per cent to 10.73 lakh hectare till June 3 this season, according to the first weekly Kharif 2022 sowing report, released by the ministry of agriculture. Cotton planting in India could jump as much as 15% in 2022 to an all-time high, as strong prices prompt farmers to switch away from other crops. A 15% rise in India's cotton crop area would lift it to around 13.8 million hectares in 2022 from 12 million hectares last year. Currently, sowing in Karnataka & Northern states of Haryana, Punjab and Rajasthan recorded slow progress. Cotton was sown on around 13.08 lakh hectare during the corresponding period of last year. The area coverage has been reported mainly from the states of Haryana (5.90 lakh ha), Punjab (2.31 lakh ha), Rajasthan (1.54 lakh ha) and Karnataka (0.72 lakh ha). Cotton sowing is delayed in Punjab, Haryana and Rajasthan due to delay in release of canal water. Normally, the sowing should have been completed till mid of May, but large number of farmers could not sow the fibre crop during the sowing period. As per information, farmers have shifted to other crops as delayed cotton sowing is prone to disease. In spot market, Cotton gained by 590 Rupees to end at 47690 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -0.94% to settled at 2539 while prices up 580 rupees, now Cotton is getting support at 45930 and below same could see a test of 45500 levels, and resistance is now likely to be seen at 46610, a move above could see prices testing 46860.
Trading Ideas:
* Cotton trading range for the day is 45500-46860.
* Cotton gains as India’s cotton sowing acreage declined 2.35 per cent to 10.73 lakh hectare till June 3 this season
* Cotton planting in India, could jump as much as 15% in 2022 to an all-time high
* A 15% rise in India's cotton crop area would lift it to around 13.8 million hectares in 2022 from 12 million hectares last year.
* In spot market, Cotton gained  by 590 Rupees to end at 47690 Rupees.

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