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Gold

Gold yesterday settled up by 0.64% at 59785 as U.S. inflation drops in line with expectations. The U.S. Department of Commerce said its core Personal Consumption Expenditures price index increased 0.2% last month, compared to May's increase of 0.3%. Inflation in the last 12 months rose 4.1%, down sharply from June's 4.6% increase. Annual inflation also came in a tick cooler than expected. Looking at the broader trend, inflation remains stubbornly high, roughly double the Federal Reserve's target of 2%. Chinese physical gold premiums rose to a four-month high on robust demand, while a price retreat fuelled a slight recovery in purchases in India. Premiums in top consumer China rose to $15-$22 an ounce over global prices from $9-$17 last week. Data showed China's June net gold imports via Hong Kong fell to their lowest in five months. Indian dealers offered discounts of up to $4 an ounce over official domestic prices, versus last week's discount of $6. China's net gold imports via Hong Kong fell by about 29% in June from the previous month, Hong Kong Census and Statistics Department data showed. Net imports into the world's top gold consumer stood at 34.648 metric tons in June, compared with 49.056 metric tons in May, as per the data. Technically market is under fresh buying as the market has witnessed a gain in open interest by 9.43% to settle at 14782 while prices are up 382 rupees, now Gold is getting support at 59547 and below same could see a test of 59309 levels, and resistance is now likely to be seen at 59927, a move above could see prices testing 60069.

Trading Ideas:
* Gold trading range for the day is 59309-60069.
* Gold gains as U.S. inflation drops in line with expectations.
* US Core PCE price index increased 0.2% last month, compared to May's increase of 0.3%.
* Chinese physical gold premiums rose to a four-month high on robust demand

Silver

Silver yesterday settled up by 0.42% at 74059 helped by a slight retreat in the dollar after signs of cooling U.S. inflation raised bets that the Federal Reserve will likely end its monetary tightening cycle. U.S. annual inflation slowed considerably in June. Inflation as measured by the personal consumption expenditures (PCE) price index increased 0.2% last month, the Commerce Department said. Both the U.S. central bank and the European Central Bank raised interest rates this week and kept the door open to further tightening. The Federal Reserve raised the target range for the federal funds rate by 25bps to 5.25%-5.5% in July 2023, in line with market expectations, and bringing borrowing costs to the highest level since January 2001. Policymakers also said they will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of inflation and employment goals. Officials will continue to take into account a wide range of information, including readings on labor market conditions, inflation pressures and inflation expectations, and financial and international developments. Technically market is under fresh buying as the market has witnessed a gain in open interest by 5.44% to settle at 15652 while prices are up 312 rupees, now Silver is getting support at 73690 and below same could see a test of 73320 levels, and resistance is now likely to be seen at 74340, a move above could see prices testing 74620.

Trading Ideas:
* Silver trading range for the day is 73320-74620.
* Silver rose helped by a slight retreat in the dollar
* U.S. annual inflation slows in June
* The Federal Reserve raised the target range for the federal funds rate by 25bps to 5.25%-5.5% in July 2023

Crude oil

Crude oil yesterday settled up by 0.26% at 6579 on signs of tight supply, China stimulus hopes and easing U.S. recession fears. Demand worries also eased after a slew of U.S. economic data pointed to a resilient economy. Data showed that the U.S. economy grew more than expected in the second quarter, helping quell fears of an imminent recession. Meanwhile, China stimulus hopes spurred expectations of oil demand regeneration from the world's largest importer of crude oil. China's state media quoted the housing minister as saying that the country needs measures such as lower home mortgage rates to help spur home purchases. Russian 2023 oil output is forecast at 515 million tonnes, Energy Minister Nkolai Shulginov told, with the final figure dependent on further quota decisions to be taken by the OPEC+ grouping. Output in 2022 stood at 535 million tonnes, a 2 percent year-on-year rise. U.S. crude stocks, gasoline and distillate inventories fell last week, the Energy Information Administration said. Crude inventories fell by 600,000 barrels in the last week to 456.8 million barrels, compared with expectations for a 2.3 million-barrel drop. Technically market is under short covering as the market has witnessed a drop in open interest by -13.35% to settle at 10007 while prices are up 17 rupees, now Crude oil is getting support at 6520 and below same could see a test of 6462 levels, and resistance is now likely to be seen at 6623, a move above could see prices testing 6668.

Trading Ideas:
* Crude oil trading range for the day is 6462-6668.
* Crude oil gains on signs of tight supply, China stimulus hopes
* Demand worries also eased after a slew of U.S. economic data pointed to a resilient economy.
* China stimulus hopes spurred expectations of oil demand regeneration from the world's largest importer of crude oil

Natural Gas

Nat.Gas yesterday settled up by 1.74% at 215.9 on forecasts for more demand over the next two weeks than previously expected as the weather remains hotter than normal through at least mid-August. Meteorologists forecast will be the hottest day of the summer so far in the U.S. Lower 48 states and the second hottest on record, according to Refinitiv data going back to 2018. Data provider Refinitiv forecast temperatures across the Lower 48 states would average 82.8 degrees Fahrenheit (28.8 Celsius) on Friday, just shy of the 83.0 F record set on July 20, 2022. Refinitiv said average gas output in the Lower 48 states rose to 101.5 bcfd so far in July, up from 101.0 bcfd in June. That compares with a monthly record of 101.8 bcfd in May. Refinitiv forecast U.S. gas demand, including exports, would rise from 105.4 bcfd this week to 106.5 bcfd next week before easing to 106.2 bcfd as the weather starts to become seasonally less hot. The forecasts for this week and next were higher than Refinitiv's outlook on Thursday. Russian gas output is forecast to decline in 2023 to 657 billion cubic metres, but that figure could be subject to a correction next month, Energy Minister Nikolai Shulginov told. Technically market is under short covering as the market has witnessed a drop in open interest by -18.14% to settle at 35749 while prices are up 3.7 rupees, now Natural gas is getting support at 211.4 and below same could see a test of 206.9 levels, and resistance is now likely to be seen at 221, a move above could see prices testing 226.1.

Trading Ideas:
* Natural gas trading range for the day is 206.9-226.1.
* Natural gas gained on forecasts for more demand
* Average gas output in the Lower 48 states rose to 101.5 bcfd so far in July, up from 101.0 bcfd in June.
* Meteorologists forecast will be the hottest day of the summer so far in the U.S. Lower 48 states and the second hottest on record


Copper

Copper yesterday settled up by 1.17% at 743.8 as expectations of Chinese stimulus have overcome fears about the nation’s demand. Prices also seen supported driven by prospects of a demand recovery after China's commitment to providing further support. Copper inventories in warehouses monitored by the Shanghai Futures Exchange fell 21.3% from last Friday, the exchange said. The discount for copper for nearby delivery on the London Metal Exchange over the three-month contract has jumped to a two-month peak after a surge in stocks available to the market in LME-registered warehouses. The discount – or contango – for cash copper over the three-month contract climbed to $40.25 a metric tonne, its highest in two months. That compared to a premium or backwardation of $31 around a month ago, when large amounts of inventory were earmarked to leave the LME system and pushed the available or on-warrant copper stocks in LME warehouses to the lowest levels since October 2021. Total stocks of copper in LME warehouses stand at 62,250 metric tonnes. Of that, cancelled warrants represent only 0.8% of the total compared with 68% a month ago. Technically market is under short covering as the market has witnessed a drop in open interest by -0.88% to settle at 4488 while prices are up 8.6 rupees, now Copper is getting support at 738.4 and below same could see a test of 732.8 levels, and resistance is now likely to be seen at 747.1, a move above could see prices testing 750.2.

Trading Ideas:
* Copper trading range for the day is 732.8-750.2.
* Copper edges higher on expectations of Chinese stimulus
* Shanghai warehouse copper stocks down 21.3%
* The discount for copper for nearby delivery on the London Metal Exchange over the three-month contract has jumped to a two-month peak

Zinc

Zinc yesterday settled up by 1.47% at 221.25 amid hopes of a recovery in Chinese demand. Beijing has pledged to provide further support to boost growth with a focus on expanding domestic demand, while it has also unveiled measures to support private investment and develop underdeveloped areas in megacities. Looking ahead, S&P Global predicts a modest 1.4% growth in global refined zinc demand for 2023, as both the US and Europe continue to grapple with inflation and tight monetary policies. Simultaneously, global refined zinc supply is expected to increase by 1.9%, considering a low base year and as energy costs in Europe ease, while power curbs in China limit zinc smelter production. The global zinc market surplus slipped to 53,000 metric tons in May, down from 64,000 tons a month earlier, data from the International Lead and Zinc Study Group (ILZSG) showed. During the first five months of 2023, ILZSG data showed a surplus of 267,000 metric tons, versus a surplus of 189,000 tons in the same period of 2022. London Metal Exchange (LME) stocks of zinc have risen above 90,000 metric tons for the first time since May of 2022 thanks to a surge of deliveries into Singapore. Technically market is under fresh buying as the market has witnessed a gain in open interest by 13.26% to settle at 3896 while prices are up 3.2 rupees, now Zinc is getting support at 219 and below same could see a test of 216.7 levels, and resistance is now likely to be seen at 222.6, a move above could see prices testing 223.9.

Trading Ideas:
* Zinc trading range for the day is 216.7-223.9.
* Zinc gains amid hopes of a recovery in Chinese demand.
* S&P Global predicts a modest 1.4% growth in global refined zinc demand for 2023
* Global zinc market surplus falls to 53,000 metric tons in May – ILZSG


Aluminium

Aluminium yesterday settled up by 0.83% at 199.9 fuelled by expectations of Chinese stimulus into the property sector, which consumes a vast amount of metals. Data shows aluminium ingot stocks across eight major markets in China were 536,000 mt as of July 27, down 18,000 mt from a week ago and 135,000 mt from a year ago. Limited arrivals and improved consumption contributed to inventory drop. Russian aluminium producer Rusal and the Nigerian government are discussing possible restart of the smelter Alscon in Nigeria which was suspended as loss-making 10 years ago, Rusal said. Alscon produced 22,000 tonnes of aluminium in 2012, 11% of its annual production capacity, before Rusal suspended it in early 2013 due to the lack of reliable gas supply and low aluminium prices. China's industrial profits extended this year's double-digit declines in June as waning demand took a toll on profit margins. Global primary aluminium output rose by 1.8% year-on-year to 34.212 million metric tons in the first half of 2023 mainly due to higher production in China, data from the International Aluminium Institute (IAI) showed. China's estimated production rose by 2.8% to 20.250 million metric tons in January-June, the IAI said. Technically market is under short covering as the market has witnessed a drop in open interest by -4.01% to settle at 3715 while prices are up 1.65 rupees, now Aluminium is getting support at 198.6 and below same could see a test of 197.2 levels, and resistance is now likely to be seen at 200.7, a move above could see prices testing 201.4.

Trading Ideas:
* Aluminium trading range for the day is 197.2-201.4.
* Aluminium gains fuelled by expectations of Chinese stimulus
* Rusal considers restart of aluminium smelter in Nigeria
* Data shows aluminium ingot stocks across China down 18,000 mt from a week ago

Mentha oil

Mentha oil yesterday settled down by -1.4% at 881.2 amid rise in supplies of new crop. Supplies have increased in Uttar Pradesh and Bihar as harvesting activities has picked up. Production prospects have improved with rising yield supported by favorable weather condition. Moreover, reports of slack export of menthol will put pressure on prices. Rising menthol imports, as well as China's limited purchasing, will put pressure on pricing. Mentha exports during Apr-May 2023, dropped by 51.60 percent to 183.98 tonnes as compared to 380.12 tonnes exported during Apr-May 2022. In May 2023 around 86.13 tonnes of Mentha was exported as against 97.85 tonnes in April 2023 showing a drop of 13.60%. In May 2023 around 86.13 tonnes of Mentha was exported as against 209.90 tonnes in May 2022 showing a drop of 58.96%. Many states have seen gutkha and pan masala ban which have seen a lower demand from the pan masala industry. The production of Mentha oil was historically high in 2020-21, the area remained almost similar last year but the yields were lower which affected the production. In the current year, production to fall to around 46,238 MT due to sharp fall in area and loss in yields following severe summer heat. which will come closed 14% down in the year 20-21. In Sambhal spot market, Mentha oil gained by 1.6 Rupees to end at 1033.1 Rupees per 360 kgs.Technically market is under fresh selling as the market has witnessed a gain in open interest by 2.39% to settle at 943 while prices are down -12.5 rupees, now Mentha oil is getting support at 876.1 and below same could see a test of 871.1 levels, and resistance is now likely to be seen at 888.1, a move above could see prices testing 895.1.

Trading Ideas:
* Mentha oil trading range for the day is 871.1-895.1.
* In Sambhal spot market, Mentha oil gained  by 1.6 Rupees to end at 1033.1 Rupees per 360 kgs.
* Menthaoil prices dropped amid rise in supplies of new crop.
* Supplies have increased in Uttar Pradesh and Bihar as harvesting activities has picked up.
* Production prospects have improved with rising yield supported by favorable weather condition.

Turmeric

Turmeric yesterday settled up by 6% at 14772 driven by consistent demand from the domestic market and export. Moreover, farmers and stockists are holding onto their stocks in anticipation of price increases due to lower sowing acreage and also lower ending stocks, resulting in a supply shortage in the cash markets. The kharif sowing acreage is expected to decrease during the current season. In Maharashtra, the sowing area is projected to decline by 10%-20%. Similarly, in Tamil Nadu, the acreage is expected to decrease by 10%-15%. In Andhra Pradesh and Telangana, there is an anticipated decline of 18%-22% in the acreage compared to the previous season. Support also seen as the untimely rains that occurred in various places in the Andhra Pradesh damaged turmeric crops causing huge loss to the farmers. Turmeric exports during Apr-May 2023, rose by 27.55 percent at 39,418.73 tonnes as compared to 30,903.38 tonnes exported during Apr-May 2022. In May 2023 around 19,827.86 tonnes of turmeric was exported as against 19,590.87 tonnes in April 2023 showing a rise of 1.21%. In May 2023 around 19,827.86 tonnes of turmeric was exported as against 17,138.35 tonnes in May 2022 showing a rise of 15.69%. In Nizamabad, a major spot market in AP, the price ended at 12904.35 Rupees gained 284.7 Rupees.Technically market is under short covering as the market has witnessed a drop in open interest by -1.86% to settle at while prices are up 836 rupees, now Turmeric is getting support at 14496 and below same could see a test of 14222 levels, and resistance is now likely to be seen at 14908, a move above could see prices testing 15046.

Trading Ideas:
* Turmeric trading range for the day is 14222-15046.
* Turmeric prices gained supported by fall in area and slower sowing progress.
* Farmers and stockists are holding onto their stocks in anticipation of price increases due to lower sowing acreage
* In May 2023 around 19,827.86 tonnes of turmeric was exported as against 19,590.87 tonnes in April 2023 showing a rise of 1.21%.
* In Nizamabad, a major spot market in AP, the price ended at 12904.35 Rupees gained 284.7 Rupees.

Jeera

Jeera yesterday settled up by 0.54% at 59980 as prices dropped on late profit booking after prices rose as arrivals in Gujarat and Rajasthan have decreased due to heavy rainfall. Farmers need assistance to bring their produce to the market. However, after the rains subside, cumin arrivals are expected to increase, potentially impacting market dynamics. Support also seen due to good export demand and expectations of lower stocks end of the current marketing year. Prices rose on crop worries grow due to unseasonal rains and hailstorms in Rajasthan, the major producing state. Cumin imports in May 2023 reached 210 metric tons, showing a substantial increase of 227.73% compared to the previous month's import volume of 64 metric tons. According to FISS forecasts, cumin demand is predicted to exceed 85 lakh bags this year, with a likely supply of 65 lakh bags. Jeera exports during Apr-May 2023, rose by 67.90 percent at 42,988.50 tonnes as compared to 25,603.35 tonnes exported during Apr-May 2022. In May 2023 around 25,903.63 tonnes of jeera was exported as against 17,084.87 tonnes in April 2023 showing a rise of 51.52%. In May 2023 around 25,903.63 tonnes of jeera was exported as against 14,894.62 tonnes in May 2022 showing a rise of 73.91%. In Unjha, a key spot market in Gujarat, jeera edged down by -600.3 Rupees to end at 60762.25 Rupees per 100 kg.Technically market is under short covering as the market has witnessed a drop in open interest by -4.48% to settle at while prices are up 325 rupees, now Jeera is getting support at 59040 and below same could see a test of 58105 levels, and resistance is now likely to be seen at 61110, a move above could see prices testing 62245.

Trading Ideas:
* Jeera trading range for the day is 58105-62245.
* Jeera prices rose as arrivals decreased due to heavy rainfall.
* Traders are avoiding bulk buying in anticipation of rise in seasonal supply of jeera in Gujarat and Rajasthan.
* The market is expecting a lower yield and quality of jeera this season
* In Unjha, a key spot market in Gujarat, jeera edged down by -600.3 Rupees to end at 60762.25 Rupees per 100 kg.

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