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Gold

Gold yesterday settled up by 0.87% at 51343 as investors sought cover from soaring inflation, with extending gains after the U.S. Federal Reserve signalled a relatively less hawkish stance on interest rate hikes. Investors continued to bet on further Federal Reserve monetary tightening to bring decades-high inflation under control. The Fed raised its benchmark overnight interest rate by 50 basis points, the biggest jump in 22 years, while Chair Jerome Powell added the bank was not considering a 75 basis-point move in the future. However, he assured Americans that the central bank will do what it takes to curb surging inflation, while acknowledging that this could risk economic pain. Meanwhile, the latest data showed the economy added 428K jobs in April, more than expectations for a 391K increase and the 12th straight month of job gains above 400K. The physical gold market in India flipped to a premium as a price dip helped drive demand in the run up to the Akshaya Tritiya festival, while COVID-induced curbs muted activity in top consumer China. Indian dealers charged premiums of up to $3 an ounce over official domestic prices versus last week's $8 discounts. The Chinese market continued to see discounts of about $10 per ounce versus global benchmark spot rates. Technically market is under short covering as market has witnessed drop in open interest by -5.89% to settled at 9021 while prices up 444 rupees, now Gold is getting support at 50986 and below same could see a test of 50629 levels, and resistance is now likely to be seen at 51619, a move above could see prices testing 51895.
Trading Ideas:
Gold trading range for the day is 50629-51895.
Gold rose as investors sought cover from soaring inflation, with extending gains after the U.S. Fed signalled a relatively less hawkish stance
Investors continued to bet on further Federal Reserve monetary tightening to bring decades-high inflation under control.
Fed Chair Jerome Powell added the bank was not considering a 75 basis-point move in the future.

Silver

Silver yesterday settled up by 0.34% at 62548 as global equities fell towards their lowest level in over a year on concerns of an economic slowdown. Equities slumped in the face of inflation and growth concerns. As the yield curve steepens, there are fears that the Federal Reserve is not doing enough to cool inflation. U.S. job growth increased more than expected in April, underscoring the economy's strong fundamentals despite a contraction in gross domestic product in the first quarter. Nonfarm payrolls rose by 428,000 jobs last month, the Labor Department said in its closely watched employment report. The European Central Bank should raise its deposit rate back into positive territory this year, French central bank chief Francois Villeroy de Galhau said, comments that point to his support for at least three rate hikes in 2022. The ECB has been moving slowly to remove support this year but record high inflation and surging longer-term price expectations have prompted a growing number of policymakers to advocate a quicker end to nearly a decade-long experiment with unconventional support. The Bank of England sent a stark warning that Britain risks a double-whammy of a recession and inflation above 10% as it raised interest rates to their highest since 2009, hiking by quarter of a percentage point to 1%. Technically market is under short covering as market has witnessed drop in open interest by -1.13% to settled at 14682 while prices up 212 rupees, now Silver is getting support at 62078 and below same could see a test of 61609 levels, and resistance is now likely to be seen at 63023, a move above could see prices testing 63499.
Trading Ideas:
Silver trading range for the day is 61609-63499.
Silver prices inched higher as global equities fell towards their lowest level in over a year on concerns of an economic slowdown.
As the yield curve steepens, there are fears that the Federal Reserve is not doing enough to cool inflation.
U.S. job growth increased more than expected in April, underscoring the economy's strong fundamentals

Crude oil

Crude oil yesterday settled up by 2.2% at 8447 amid supply worries after the EU proposed some of its toughest measures yet against Russia, including a total ban on oil imports. The two oil stock releases carried out so far amount to only 9% of overall stocks, Fatih Birol, head of the International Energy Agency (IEA), said. "We can come back again if there is a problem," he said while speaking remotely during an event in Florence, Italy. Birol said a situation where a short-term scramble for alternative energy sources to Russia prolonged reliance on volatile fossil fuels had to be avoided. The IEA last month listed members' contributions to a 120-million-barrel release of crude and oil products from emergency stockpiles to bring down global oil prices after the beginning of the Ukraine crisis. The Kuwaiti oil minister said that the OPEC+ strategy of monthly crude production increases ensures market stability and balance. Minister Mohamed al-Fares also said that the group, comprised of the Organization of Petroleum Exporting Countries and allies including Russia, was monitoring coronavirus lockdowns in Chinese cities and any possible supply disruptions. OPEC+ agreed to another modest monthly oil output increase, arguing that the producer group could not be blamed for disruptions to Russian supply and saying China's coronavirus lockdowns threatened the outlook for demand. Technically market is under fresh buying as market has witnessed gain in open interest by 17.52% to settled at 8305 while prices up 182 rupees, now Crude oil is getting support at 8322 and below same could see a test of 8197 levels, and resistance is now likely to be seen at 8563, a move above could see prices testing 8679.
Trading Ideas:
Crude oil trading range for the day is 8197-8679.
Crude oil prices climbed amid supply worries after the EU proposed some of its toughest measures yet against Russia, including a total ban on oil imports.
The OPEC countries are not willing to replace Russian oil despite concerns about slower demand in China due to Covid 19.
Oil releases so far are just 9% of stocks, "can come back again if a problem" – IEA head

Nat.Gas

Nat.Gas yesterday settled down by -6.43% at 623.2 on forecasts for a slow rise in output, milder weather and a drop in demand in the next two weeks. Data provider Refinitiv said average gas output in the U.S. Lower 48 states slid to 94.3 billion cubic feet per day (bcfd) so far in May from 94.5 bcfd in April. That output has increased in recent days and compares with a monthly record of 96.1 bcfd in November 2021. Refinitiv projected average U.S. gas demand, including exports, would slide from 90.6 bcfd this week to 90.4 bcfd next week and 89.5 bcfd in two weeks as the weather turns seasonally milder. The forecast for next week was higher than Refinitiv's outlook on Thursday. The amount of gas flowing to U.S. LNG export plants rose to 12.3 bcfd so far in May from 12.2 bcfd in April, but remains below the monthly record of 12.9 bcfd in March. 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 97.41 billion cubic feet per day (bcfd) in 2022 and 100.86 bcfd in 2023 from a record 93.57 bcfd in 2021. Technically market is under long liquidation as market has witnessed drop in open interest by -32.47% to settled at 5249 while prices down -42.8 rupees, now Natural gas is getting support at 595.1 and below same could see a test of 567 levels, and resistance is now likely to be seen at 671.9, a move above could see prices testing 720.6.
Trading Ideas:
Natural gas trading range for the day is 567-720.6.
Natural gas slid on forecasts for a slow rise in output, milder weather and a drop in demand in the next two weeks.
U.S. natgas output, demand to rise in 2022 – EIA
The U.S. EIA said utilities added 77 billion cubic feet (bcf) of gas to storage during the week ended April 29.


Copper

Copper yesterday settled down by -0.09% at 761.5 as the U.S. dollar rose to a 20-year high and as global equities tumbled on worries over a higher interest rate environment hurting global growth. Copper inventories in warehouses monitored by the Shanghai Futures Exchange rose 8.1 percent from last Friday, the exchange said. The Federal Reserve raised its benchmark overnight interest rate by half a percentage point, the biggest jump in 22 years, to fight against soaring inflation. German industrial orders fell more than expected in March, driven mainly by a reduction in orders from abroad as the war in Ukraine hit manufacturing demand in Europe's biggest economy, data showed. Peru pledged to review conditions around a major cooper mine but said it would not lift by Friday an emergency declaration temporarily suspending civil liberties in the area. The global copper market is expected to see a surplus of 142,000 tonnes this year and of 352,000 tonnes in 2023, the International Copper Study Group (ICSG) said. "World mine production this year is expected to benefit from additional output from new and expanded mines as well as an improvement in the general situation regarding the pandemic," the ICSG said in a release. World apparent refined copper usage is expected to increase by about 1.9% in 2022 and 2.8% in 2023, the Group said. Technically market is under long liquidation as market has witnessed drop in open interest by -1.87% to settled at 4095 while prices down -0.65 rupees, now Copper is getting support at 757.5 and below same could see a test of 753.3 levels, and resistance is now likely to be seen at 767.1, a move above could see prices testing 772.5.
Trading Ideas:
Copper trading range for the day is 753.3-772.5.
Copper prices fell as the U.S. dollar rose to a 20-year high and as global equities tumbled on worries over a higher interest rate environment hurting global growth.
Copper inventories in warehouses monitored by the Shanghai Futures Exchange rose 8.1 percent from last Friday.
German industrial orders fell more than expected in March, driven mainly by a reduction in orders from abroad

Zinc

Zinc yesterday settled down by -1.35% at 326.1 as the tightening monetary policy across the globe and sluggish domestic consumption pressured the market. Exported China zinc ingot earlier seemed to have been delivered to LME warehouses, with that in Taiwan, China recorded a gain 1,575 mt. China's export growth is expected to have slowed to a crawl in April as strict COVID-19 curbs hit production while imports likely extended declines, creating headwinds for the world's second-largest economy in the second quarter. According to the data released by the London Metal Exchange (LME), inventory of zinc continued to fall last week after surging to 144,425 mt on March 15, with the latest stocks at 93,175 mt, hitting a new low within 2 years. According to SHFE data, SHFE zinc stocks fell in the week of April 29, with weekly stocks decreasing by 3.75% to 169,598 mt, hitting a new low within 2 months. Total zinc inventories across seven markets in China stood at 281,100 mt as of May 5, up 4,000 mt from April 29, down 2,800 mt from April 25. In Shanghai, the market finally saw actual de-stocking of 900 mt under the recovery of picking up goods. In Tianjin, the market continued to de-stocking with stable arrivals and the recovery of consumption. Technically market is under fresh selling as market has witnessed gain in open interest by 1.13% to settled at 1164 while prices down -4.45 rupees, now Zinc is getting support at 321.9 and below same could see a test of 317.6 levels, and resistance is now likely to be seen at 329.8, a move above could see prices testing 333.4.
Trading Ideas:
Zinc trading range for the day is 317.6-333.4.
Zinc prices closed with losses as the tightening monetary policy across the globe and sluggish domestic consumption pressured the market.
China's export growth is expected to have slowed to a crawl in April as strict COVID-19 curbs hit production while imports likely extended declines
Total zinc inventories across seven markets in China stood at 281,100 mt as of May 5, up 4,000 mt from April 29, down 2,800 mt from April 25.

Nickel

Nickel yesterday settled down by -0.49% at 2325 as Sumitomo Metal sees global nickel demand for battery use at 410,000 in 2022. China manufacturing PMI which stood at 48.83, down 4.62% YoY, and the climate index was greatly impacted by the pandemic. On the supply side, the pandemic has brought transportation problems, and the supply of Jinchuan nickel in Shanghai is relatively tight. As the price difference between SHFE and LME nickel remains great, and the supply of Sumitomo, NORNICKEL, NIKKELVERK nickel and nickel briquette is still tight. In terms of nickel pig iron, the production and transportation problems of NPI plants in Liaoning and Inner Mongolia have been seriously affected, and the output is expected to fall in March. On the demand side, the cost efficiency of self-dissolved nickel briquette in the nickel sulphate plant has not recovered amid high futures prices. In addition, the output of the downstream precursor plants and the ternary cathode material plants did not contract in March thanks to their in-plant stocks, but the inventory in April will be low, hence there is possibility of production cuts. Technically market is under fresh selling as market has witnessed gain in open interest by 2.27% to settled at 45 while prices down -11.4 rupees, now Nickel is getting support at 2325 and below same could see a test of 2325 levels, and resistance is now likely to be seen at 2325, a move above could see prices testing 2325.
Trading Ideas:
Nickel trading range for the day is 2325-2325.
Nickel settled flat as Sumitomo Metal sees global nickel demand for battery use at 410,000 in 2022
Global nickel market sees surplus in February – INSG
Nickel briquette prices stood above 200,000 yuan/mt, and demand from nickel sulphate plants may contract.

Aluminium

Aluminium yesterday settled down by -1.7% at 239.8 as concerns about demand created by a slowdown in manufacturing activity, particularly in top consumer China, were reinforced by the strong dollar. Prices can see some support as China's Premier of the State Council chaired an executive meeting of the State Council on May 5 to deploy further relief measures for small, medium and micro enterprises and individual entrepreneurs to protect market players and stabilise employment. China's factory activity shrank at the sharpest pace in 26 months in April, while manufacturing activity in the United States and the euro zone slowed. China's trade data due Monday is expected to show export growth slowed in April as strict COVID-19 curbs hit output while imports likely extended declines. China's export growth is expected to have slowed to a crawl in April as strict COVID-19 curbs hit production while imports likely extended declines, creating headwinds for the world's second-largest economy in the second quarter. The resumption of production at aluminium plants was faster than expected. With concentrated arrivals after the May Day holiday, inventory was under pressure again. On the demand side, with inadequate orders in some downstream enterprises, the operating rates of downstream enterprises have declined during May Day. In general, domestic fundamentals are still under pressure, while aluminium prices may move rangebound at low. Technically market is under fresh selling as market has witnessed gain in open interest by 4.44% to settled at 2800 while prices down -4.15 rupees, now Aluminium is getting support at 237.4 and below same could see a test of 234.9 levels, and resistance is now likely to be seen at 243.2, a move above could see prices testing 246.5.
Trading Ideas:
Aluminium trading range for the day is 234.9-246.5.
Aluminium prices fell as concerns about demand created by a slowdown in manufacturing activity, particularly in China, were reinforced by the strong dollar.
China's Premier of the State Council chaired an executive meeting to deploy further relief measures for small, medium and micro enterprises
China's factory activity shrank at the sharpest pace in 26 months in April, while manufacturing activity in the United States and the euro zone slowed

Mentha oil

Mentha oil yesterday settled up by 0.94% at 1086.6 as 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. Prices gains amid loss in production and improvement in demand while monsoon is yet to be seen as last year heavy rains in the pre-monsoon season came like a disaster for farmer. FMCG industry reels under extraordinary inflationary pressures, experts believe it will continue to grow in both volume and value, but margins will get squeezed. In Sambhal spot market, Mentha oil gained by 5 Rupees to end at 1217.2 Rupees per 360 kgs.Technically market is under short covering as market has witnessed drop in open interest by -0.57% to settled at 1050 while prices up 10.1 rupees, now Mentha oil is getting support at 1072.7 and below same could see a test of 1058.9 levels, and resistance is now likely to be seen at 1096.4, a move above could see prices testing 1106.3.
Trading Ideas:
Mentha oil trading range for the day is 1058.9-1106.3.
In Sambhal spot market, Mentha oil gained  by 5 Rupees to end at 1217.2 Rupees per 360 kgs.
Mentha oil prices gained as the harvest is expected to be almost the same as last year's in Barabanki area but harvesting 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.

Turmeric

Turmeric yesterday settled up by 1.18% at 8204 as the arrivals of New season turmeric are diminishing and exports demand is improving as season progresses. As per first advance estimates by the Govt for 2021/22 season, the production of turmeric is pegged at 11.76 lakh tonnes in 2021-22 against 11.24 lt in 2020-21. As per govt data, turmeric exports in Jan 2022 is down by 25% m/m at 10,600 tonnes Vs 14275 tonnes in Dec 2021. In Feb, turmeric exports recorded lower by 17% on year 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. 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 8581.7 Rupees gained 58.4 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -19% to settled at while prices up 96 rupees, now Turmeric is getting support at 8002 and below same could see a test of 7802 levels, and resistance is now likely to be seen at 8314, a move above could see prices testing 8426.
Trading Ideas:
Turmeric trading range for the day is 7802-8426.
Turmeric gains as the arrivals of New season turmeric are diminishing and exports demand is improving as season progresses.
As per first advance estimates, the production of turmeric is pegged at 11.76 lakh tonnes in 2021-22 against 11.24 lt in 2020-21.
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.
In Nizamabad, a major spot market in AP, the price ended at 8581.7 Rupees gained 58.4 Rupees.

Jeera

Jeera yesterday settled up by 0.96% at 20980 because of lower production of the spice in the country, partly because many farmers shifted to more lucrative commodities. The low yield in India will affect the global prices as the country is the largest producer of jeera or cumin in the world. Total cumin output is estimated to have declined about 35% year-on-year to 558 million tonnes in 2022. The main reason for the low yield and low acreage under cultivation is that during the cumin sowing period (October-December 2021) farmers shifted to gram and mustard whose prices were higher than that of cumin. Secondly, excess rainfall in the key cumin belts of Dwarka, Banaskantha and Kutch in Gujarat, and Jodhpur and Nagaur in Rajasthan increased the probability of wilt attack, preventing farmers from sowing the crop. Cumin exports declined ~24% on-year in fiscal 2022 (April 2021- February 2022), owing to 51% drop in exports to China (accounts for one-third of exports) following a pesticide residue issue in Indian consignments. Given that production has likely declined by a significant ~35%, exports too are expected to fall this fiscal. In Unjha, a key spot market in Gujarat, jeera edged down by -298.35 Rupees to end at 21119.95 Rupees per 100 kg.Technically market is under short covering as market has witnessed drop in open interest by -14.52% to settled at while prices up 200 rupees, now Jeera is getting support at 20630 and below same could see a test of 20285 levels, and resistance is now likely to be seen at 21160, a move above could see prices testing 21345.
Trading Ideas:
Jeera trading range for the day is 20285-21345.
Jeera gained because of lower production of the spice in the country, partly because many farmers shifted to more lucrative commodities.
The low yield in India will affect the global prices as the country is the largest producer of jeera or cumin in the world.
Total cumin output is estimated to have declined about 35% year-on-year to 558 million tonnes in 2022.
In Unjha, a key spot market in Gujarat, jeera edged down by -298.35 Rupees to end at 21119.95 Rupees per 100 kg.

Cotton

Cotton yesterday settled up by 0.28% at 46670 due to concerns over production, slow arrivals, better domestic and exports demand. Domestic cotton arrivals down 25% or 88.95 lakh bales so far this season to around 238 lakh bales compared to last year. The Telangana government is targeting to increase the area under cotton by 55–65 per cent to about 28–30 lakh hectares (lh) from last year’s 18 lakh hectares even as the cottonseed industry pegged the growth in cotton acreage at 15 per cent in the upcoming kharif season, starting July. As per USDA report, all cotton planted area for coming season (2022) is estimated at 12.2 million acres, up 9 percent from last year. In its latest Apr report, the USDA increase global cotton production forecast in 2021-22 to 120.2 million bales (1 US bale= 218kg), compared to 119.9 million bales in Feb 2022. India’s crop is being unchanged at 26.50 million bales. India allowed duty-free imports of cotton until Sept. 30 as prices in the local market jumped to a record high because of a drop in the production, the government said in a notification. The world's biggest producer of the fibre also removed the Agriculture Infrastructure and Development Cess (AIDC) on the imports, the government said. In spot market, Cotton dropped by -180 Rupees to end at 46400 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -2.54% to settled at 3605 while prices up 130 rupees, now Cotton is getting support at 46030 and below same could see a test of 45400 levels, and resistance is now likely to be seen at 47120, a move above could see prices testing 47580.
Trading Ideas:
Cotton trading range for the day is 45400-47580.
Cotton prices rose due to concerns over production, slow arrivals, better domestic and exports demand.
India allowed duty-free imports of cotton until Sept. 30 as prices in the local market jumped to a record high because of a drop in the production.
India's cotton output is likely to fall to 33.51 million bales in the current year from last year's 35.3 million bales, estimates CAI.
In spot market, Cotton dropped  by -180 Rupees to end at 46400 Rupees.

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