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Gold

Gold yesterday settled down by -1.28% at 50174 as investors flocked to the dollar driven by bets the U.S. Federal Reserve will stick to aggressive rate hikes. Declines in gold were, however, capped by a slide in the benchmark 10-year Treasury yields, which hit the lowest level in two weeks. U.S. April inflation at 8.3% remained "hot" but does not yet require the Federal Reserve to switch to three-quarter point rate increases, St. Louis Fed President James Bullard said. The Fed's current plan for half point increases is "a good benchmark for now," Bullard said. Large increases are "not my base case ... I think we have a good plan in place," Bullard said. The comments from one of the Fed's most vocal advocates of faster rate hikes show how tightly U.S. central bankers have coalesced around the plan outlined by Fed Chair Jerome Powell last week to raise rates by half a point at the next two Fed meetings, and take stock along the way of how inflation is behaving and what more might need to be done. Bullard, however, repeated that he feels the Fed will need to keep moving in those half-point increments for the remainder of 2022, pushing the federal funds rate to a range of between 3.25% and 3.5% by the end of the year. Technically market is under long liquidation as market has witnessed drop in open interest by -4.47% to settled at 7482 while prices down -648 rupees, now Gold is getting support at 49894 and below same could see a test of 49614 levels, and resistance is now likely to be seen at 50700, a move above could see prices testing 51226.
Trading Ideas:
Gold trading range for the day is 49614-51226.
Gold dropped as investors flocked to the dollar driven by bets the U.S. Federal Reserve will stick to aggressive rate hikes.
Declines in gold were, however, capped by a slide in the benchmark 10-year Treasury yields, which hit the lowest level in two weeks.
Bullard: April inflation 'hot' but does not see 75 bp Fed rate increase 'for now'

Silver

Silver yesterday settled down by -3.29% at 58751 as the dollar stood tall, hitting fresh two-decade highs on concerns that tighter monetary policies to tame surging inflation could slow global economic growth. U.S. consumer price inflation data released overnight did little to ease investor worries over the outlook for inflation and interest rates. The dollar has been rising for five straight weeks, tracking gains in U.S. Treasury yields on expectations of further tightening from the Fed. Federal Reserve Bank of St. Louis James Bullard said he was content with a plan to raise interest rates by 50 basis points at each of the next two meetings and would like to see the Fed's policy rate go up to 3.5 percent by the end of the year. The number of Americans filing new claims for unemployment benefits unexpectedly rose last week, touching the highest level in three months, but there is no material shift in labor market conditions amid strong demand for workers. That was reinforced by a report from the Labor Department on Thursday which also showed that the number of people on state unemployment rolls was the smallest in more than 52 years at the end of April. Companies are scrambling for workers to fill record job openings, which is helping to boost inflation. Technically market is under fresh selling as market has witnessed gain in open interest by 16.03% to settled at 18289 while prices down -2001 rupees, now Silver is getting support at 58023 and below same could see a test of 57295 levels, and resistance is now likely to be seen at 60067, a move above could see prices testing 61383.
Trading Ideas:
Silver trading range for the day is 57295-61383.
Silver prices subdued as the dollar stood tall, on concerns that tighter monetary policies to tame surging inflation could slow global economic growth.
The dollar has been rising for five straight weeks, tracking gains in U.S. Treasury yields on expectations of further tightening from the Fed.
The number of Americans filing new claims for unemployment benefits unexpectedly rose last week, touching the highest level in three months

Crude oil

Crude oil yesterday settled up by 0.23% at 8174 shrugging off early weakness despite persisting concerns about growth and the outlook for energy demand. Oil prices have been under pressure this week, along with global financial markets, amid jitters over rising interest rates, the strongest U.S. dollar in two decades, concerns over inflation and possible recession. Prolonged COVID-19 lockdowns in the world's top crude importer, China, have also impacted the market. U.S. commercial crude stocks rose last week due to a record release of oil from U.S. strategic reserves, but that could not prevent another drawdown of gasoline supply headed into driving season, the Energy Information Administration said. Crude inventories rose by 8.5 million barrels in the week to May 6 to 424.2 million barrels, compared with expectations in poll for a decline of 457,000 barrels. Lower output from Russia due to the fallout from its invasion of Ukraine will not leave the world short of oil, the International Energy Agency (IEA) said, as supply ramps up elsewhere and Chinese lockdowns tamp down demand. "Over time, steadily rising volumes from Middle East OPEC+ and the U.S. along with a slowdown in demand growth is expected to fend off an acute supply deficit amid a worsening Russian supply disruption," the IEA said in its monthly oil report. Technically market is under short covering as market has witnessed drop in open interest by -7.6% to settled at 5662 while prices up 19 rupees, now Crude oil is getting support at 7986 and below same could see a test of 7797 levels, and resistance is now likely to be seen at 8331, a move above could see prices testing 8487.
Trading Ideas:
Crude oil trading range for the day is 7797-8487.
Crude oil ended higher shrugging off early weakness despite persisting concerns about growth and the outlook for energy demand.
U.S. crude stocks jump on big release from strategic reserves - EIAOPEC cites the impact of the war in Ukraine and COVID-19 restrictions in China for demand the downgrade

Nat.Gas

Nat.Gas yesterday settled up by 1.25% at 598.3 on a smaller than normal weekly storage build and a jump in European gas prices on Russian supply concerns. The U.S. Energy Information Administration (EIA) said utilities added 76 billion cubic feet (bcf) of gas to storage during the week ended May 6. 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 96.71 billion cubic feet per day (bcfd) in 2022 and 101.71 bcfd in 2023 from a record 93.55 bcfd in 2021. The agency also projected gas consumption would rise from 82.97 in 2021 to 85.73 bcfd in 2022 before sliding to 85.28 bcfd in 2023. That compares with a record 85.29 bcfd in 2019. U.S. natgas firms rise on Weds after Kyiv halted use of major route carrying Russian gas through Ukraine, which helped boost U.S. gas futures. Public natural gas supplier Bulgargaz said it expects the wholesale gas price in Bulgaria to be 142.11 levs per MWh in July – a decline of 4.4% on the price projected last month for June but only 0.33% below the price for April, which recently approved by the energy regulator. Technically market is under fresh buying as market has witnessed gain in open interest by 2.96% to settled at 4451 while prices up 7.4 rupees, now Natural gas is getting support at 572.7 and below same could see a test of 547.1 levels, and resistance is now likely to be seen at 613.7, a move above could see prices testing 629.1.
Trading Ideas:
Natural gas trading range for the day is 547.1-629.1.
Natural gas rose on a smaller than normal weekly storage build and a jump in European gas prices on Russian supply concerns.
EIA said utilities added 76 billion cubic feet (bcf) of gas to storage during the week ended May 6.
U.S. natural gas production and demand will both rise in 2022 as the economy grows


Copper

Copper yesterday settled down by -1.48% at 744.75 as traders worried that a slowing global economy would require less metal. With inflation surging and interest rates rising, growth fears also pushed down oil prices and stock markets hit a 1-1/2-year low. COVID lockdowns in China, the top metals consumer, war in Ukraine and aggressive interest rate rises were all hurting the outlook for the economy and metals demand, but added that the sell-off was likely overdone in the short term. U.S. consumer prices rose 8.3% in April year-on-year, suggesting interest rate rises to rein in inflation will continue. A senior Chinese official said the country is eyeing new incremental policies to prop up growth and will take steps when necessary. Data showed British economy shrank in March, highlighing the cost-of-living crisis while persistently hot U.S. inflation data exacerbated investor fears of aggressive rate hikes. Britain's economy shrank by 0.1% in March, but expanded by 0.8% for the first quarter of 2022 as a whole, in what is likely to have been a high point for 2022 as the cost-of-living crisis increasingly bites, according to data. Customs data showed that China's copper imports in April fell 4% from the same month a year earlier, as lockdowns hurt manufacturing activity and consumption. Technically market is under fresh selling as market has witnessed gain in open interest by 7.71% to settled at 4483 while prices down -11.2 rupees, now Copper is getting support at 737.3 and below same could see a test of 729.8 levels, and resistance is now likely to be seen at 754.2, a move above could see prices testing 763.6.
Trading Ideas:
Copper trading range for the day is 729.8-763.6.
Copper prices tumbled as traders worried that a slowing global economy would require less metal.
With inflation surging and interest rates rising, growth fears also pushed down oil prices and stock markets hit a 1-1/2-year low.
Customs data showed that China's copper imports in April fell 4% from the same month a year earlier, as lockdowns hurt manufacturing activity and consumption.

Zinc

Zinc yesterday settled down by -3.3% at 306.3 as China’s central bank hinted at further monetary easing, while a strong US inflation print reinforced bets for aggressive Federal Reserve rate hikes. The People’s Bank of China said it is making stabilizing economic growth a top priority and will step up support for weak sectors, while adding that it has guided loan interest rates lower from an already low level. The central bank has taken relatively modest easing action in recent months despite the sharp slump in activity due to Covid lockdowns. The PBOC made a smaller-than-expected cut in the reserve requirement ratio for banks last month and refrained from cutting policy interest rates. Still, lending rates in the economy have come down, with the weighted average interest rate for corporate loans standing at 4.4% in the first quarter, down 0.21 percentage point from the end of 2021. China's refined zinc output at 52 major smelters rose in April from the previous month, COVID-related transportation disruptions eased and new capacity started up. Smelters produced 438,000 tonnes of zinc last month, up by 11,000 tonnes from a revised output of 427,000 tonnes in March and 0.2% higher than a year earlier. The increase mainly stemmed from new capacity additions and the resumption of output in Hunan, Gansu and Qinghai provinces and the Guangxi region. Technically market is under fresh selling as market has witnessed gain in open interest by 4.28% to settled at 1268 while prices down -10.45 rupees, now Zinc is getting support at 301.8 and below same could see a test of 297.1 levels, and resistance is now likely to be seen at 313.1, a move above could see prices testing 319.7.
Trading Ideas:
Zinc trading range for the day is 297.1-319.7.
Zinc dropped as China’s central bank hinted at further monetary easing, while a strong US inflation print reinforced bets for aggressive Federal Reserve rate hikes.
China's refined zinc output at 52 major smelters rose in April from the previous month.
The People’s Bank of China said it is making stabilizing economic growth a top priority and will step up support for weak sectors


Aluminium

Aluminium yesterday settled down by -0.11% at 232.3 as coronavirus-induced lockdowns in top consumer China sparked concerns about demand and growth. Pressuring prices further was the continued appreciation of the US dollar, and lingering concerns about global economic growth on a backdrop of high inflation, coupled with an aggressive tightening monetary policy. China's producer prices rose at the slowest pace in a year in April, despite a surge in global commodity prices, leaving room for more stimulus to shore up the flagging economy, which faces pressure from heavy COVID-19 curbs. China's two largest cities tightened COVID-19 curbs, fuelling public angst and even questions about the legality of its uncompromising battle with the virus that has battered the world's second largest economy. Atlanta Federal Reserve President Raphael Bostic said he expects the U.S. central bank to deliver two or three more half-percentage-point interest rate hikes but won't need to use anything bigger, noting some hopeful signs on inflation. Rio Tinto said any sanctions on Russian aluminium producer Rusal for Moscow's invasion of Ukraine would significantly disrupt the aluminium market and drive prices up. Manufacturing activity contracted in China, grew at its slowest pace in more than 1-1/2 years in the United States and stalled in the euro zone in April, data showed. Technically market is under long liquidation as market has witnessed drop in open interest by -7.64% to settled at 2501 while prices down -0.25 rupees, now Aluminium is getting support at 229.3 and below same could see a test of 226.2 levels, and resistance is now likely to be seen at 234.4, a move above could see prices testing 236.4.
Trading Ideas:
Aluminium trading range for the day is 226.2-236.4.
Aluminium dropped as coronavirus-induced lockdowns in top consumer China sparked concerns about demand and growth.
Pressuring prices further was the continued appreciation of the US dollar, and lingering concerns about global economic growth on a backdrop of high inflation
China's producer prices rose at the slowest pace in a year in April, despite a surge in global commodity prices.

Mentha oil

Mentha oil yesterday settled down by -0.19% at 1130.9 on profit booking after seen supported 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 2.4 Rupees to end at 1228.3 Rupees per 360 kgs.Technically market is under long liquidation as market has witnessed drop in open interest by -1.29% to settled at 993 while prices down -2.2 rupees, now Mentha oil is getting support at 1124.4 and below same could see a test of 1117.8 levels, and resistance is now likely to be seen at 1138.3, a move above could see prices testing 1145.6.
Trading Ideas:
Mentha oil trading range for the day is 1117.8-1145.6.
In Sambhal spot market, Mentha oil gained  by 2.4 Rupees to end at 1228.3 Rupees per 360 kgs.
Mentha oil dropped on profit booking after seen supported as the harvest 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.

Turmeric

Turmeric yesterday settled up by 0.48% at 8436 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 8518.25 Rupees gained 21.95 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 5.47% to settled at 14940 while prices up 40 rupees, now Turmeric is getting support at 8328 and below same could see a test of 8220 levels, and resistance is now likely to be seen at 8516, a move above could see prices testing 8596.
Trading Ideas:
Turmeric trading range for the day is 8220-8596.
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 8518.25 Rupees gained 21.95 Rupees.

Jeera

Jeera yesterday settled up by 2.78% at 21790 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 up by 25.15 Rupees to end at 21442.1 Rupees per 100 kg.Technically market is under fresh buying as market has witnessed gain in open interest by 2.96% to settled at 14295 while prices up 590 rupees, now Jeera is getting support at 21290 and below same could see a test of 20790 levels, and resistance is now likely to be seen at 22080, a move above could see prices testing 22370.
Trading Ideas:
Jeera trading range for the day is 20790-22370.
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 up by 25.15 Rupees to end at 21442.1 Rupees per 100 kg.

Cotton

Cotton yesterday settled up by 1.86% at 48640 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 Cotton Association of India has reduced its cotton crop estimate for the 2021-22 season by 8.00 lakh bales to 33.5 million bales from its previous estimate of 34.3 million bales. (One bale=170 kgs.) In the past three months, they have revised the production estimate by 23 lakh bales from their original estimate of 36 million bales. The domestic consumption for the crop year 2021-22 has been reduced by the CAI by 5 lakh bales to 34 million bales. Ending stock as of 30th September 2022 is estimated by the Committee at 4 million bales versus the previous year’s level of 7.5 million bales. Union Minister for Commerce and Industry and Textiles Piyush Goyal will hold a meeting with stakeholders of the cotton textiles value chain on Wednesday in New Delhi. According to Textiles Secretary Upendra Prasad Singh, the Minister has planned a meeting with all stakeholders of the cotton textile sector to discuss the issue of high cotton and yarn prices, the measures that can be taken, etc. “Any decision can be taken only after the meeting,” he said. In spot market, Cotton dropped by -130 Rupees to end at 47810 Rupees.Technically market is under short covering as market has witnessed drop in open interest by -7.94% to settled at 2970 while prices up 890 rupees, now Cotton is getting support at 47980 and below same could see a test of 47330 levels, and resistance is now likely to be seen at 49040, a move above could see prices testing 49450.
Trading Ideas:
Cotton trading range for the day is 47330-49450.
Cotton prices gained from all time high level due to concerns over production, slow arrivals, better domestic and exports demand.
CAI has reduced its cotton crop estimate for the 2021-22 season by 8.00 lakh bales to 33.5 million bales
The Union government may impose a temporary ban on cotton exports if cotton prices continue to surge
In spot market, Cotton dropped  by -130 Rupees to end at 47810 Rupees.

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