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Gold

Gold yesterday settled down by -0.3% at 59641 as annual inflation rate in the US likely fell to 4.1% in May 2023, the lowest since March 2021, from 4.9% in April and 5% in March, mainly due to lower energy prices. On a monthly basis, the CPI is projected to increase by 0.2%, easing from a 0.4% rise in April. Demand for gold will drop 9% to 4,375 metric tons this year with central banks' appetite falling from last year's all-time high, adding that gold prices would be under pressure in the second half of 2023. The net official sector purchases jumped 141% to a record high of 1,083 metric tons in 2022 amid de-dollarisation activity, inflated by western sanctions on Russia after its invasion of Ukraine. These purchases are due to fall but remain at historically strong 600 metric tons in 2023. Investor sentiment continued to improve in the gold market even as prices fell below $2,000 an ounce last month, according to the latest research from the World Gold Council. In a report, the WGC said that 19 tonnes of gold, valued at $1.7 billion, flowed into global gold-backed exchange-traded products in May. This is the third consecutive month that investment demand for gold has increased. Technically market is under long liquidation as the market has witnessed a drop in open interest by -1.28% to settle at 13988 while prices are down -180 rupees, now Gold is getting support at 59458 and below same could see a test of 59274 levels, and resistance is now likely to be seen at 59873, a move above could see prices testing 60104.

Trading Ideas:
* Gold trading range for the day is 59274-60104.
* Gold dropped as annual inflation rate in the US likely fell to 4.1% in May 2023
* On a monthly basis, the CPI is projected to increase by 0.2%, easing from a 0.4% rise in April.
* Reduced appetite from central banks to bring gold demand down in 2023

Silver

Silver yesterday settled down by -1.11% at 72974 as dollar index steadied as investors geared up for US inflation data and the Federal Reserve’s interest rate decision this week. Meanwhile, markets remain divided on whether the US central bank would hold rates steady or resume its policy tightening in July. Externally, investors also braced for monetary policy decisions from the European Central Bank and the Bank of Japan. The ECB is widely expected to raise its policy rate by 25 basis points this week and again in July to combat sticky inflation. On the other hand, the BOJ is anticipated to maintain its ultra-loose monetary policy this week as continued economic recovery was countered by slowing global growth. CME Group's FedWatch Tool currently indicates a 71.2 percent chance the Fed will leave rates unchanged on Wednesday, but a 28.8 percent chance of another quarter point rate hike in July. In economic releases, a report on U.S. consumer inflation expectations for May and monthly budget statement for the month of May will be out in the New York session. U.S. reports on retail sales, industrial production and consumer sentiment may attract attention later in the week. Technically market is under long liquidation as the market has witnessed a drop in open interest by -13.84% to settle at 14655 while prices are down -822 rupees, now Silver is getting support at 72546 and below same could see a test of 72119 levels, and resistance is now likely to be seen at 73583, a move above could see prices testing 74193.

Trading Ideas:
* Silver trading range for the day is 72119-74193.
* Silver dropped as dollar steadied as investors geared up for US inflation data
* Markets remain divided on whether the US central bank would hold rates steady or resume its policy tightening in July.
* Investors also braced for monetary policy decisions from the European Central Bank and the Bank of Japan.

Crude oil

Crude oil yesterday settled down by -4.38% at 5569 amid persistent concerns around the demand outlook and ahead of a slew of key central bank meetings due this week. Concerns about China's fuel demand growth and rising Russian crude supply weighed on prices, with Goldman Sachs Group Inc. cutting its price forecast by nearly 10 percent. Goldman Sachs lowered its Brent outlook for December to $86 a barrel from $95 a barrel, citing signs of increasing supply and slower demand for crude. The investment bank also revised down its WTI forecast for December from $89 per barrel to $81 despite Saudi Arabia's announcement of output cuts and efforts by OPEC Plus to limit supplies into 2024. U.S. crude oil stockpiles fell unexpectedly last week, while distillate and gasoline inventories rose, the Energy Information Administration (EIA) said. Crude inventories fell by 451,000 barrels in the week to June 2, the EIA said, compared with expectations for a 1 million-barrel rise. Crude stocks at the Cushing, Oklahoma, delivery hub rose by 1.7 million barrels last week, the EIA said. Refinery crude runs rose by 482,000 barrels per day (bpd), while refinery utilization rates increased by 2.7 percentage points in the week. Technically market is under fresh selling as the market has witnessed a gain in open interest by 17.15% to settle at 18231 while prices are down -255 rupees, now Crude oil is getting support at 5478 and below same could see a test of 5388 levels, and resistance is now likely to be seen at 5704, a move above could see prices testing 5840.

Trading Ideas:
* Crude oil trading range for the day is 5388-5840.
* Crude oil dropped amid persistent concerns around the demand outlook
* Concerns about China's fuel demand growth and rising Russian crude supply weighed on prices
* Goldman Sachs Group Inc. cutting its price forecast by nearly 10 percent.
 

Natural Gas

Nat.Gas yesterday settled down by -0.48% at 186.3 on forecasts for less demand than previously expected over the next two weeks. That price decline came despite a drop in gas exports from Canada due to wildfires and as the amount of gas flowing to U.S. liquefied natural gas (LNG) export plants remained low due to maintenance work. Data provider Refinitiv said average gas output in the U.S. Lower 48 states eased to 102.3 billion cubic feet per day (bcfd) so far in June, down from a monthly record of 102.5 bcfd in May. The amount of gas flowing from Canada to the United States was on track to rise to 7.5 bcfd on Monday from a near two-week low of 7.2 bcfd on Saturday when wildfires again caused energy firms to shut-in wells and pipelines. Those exports were down from an average of 8.1 bcfd during the first nine days of June but up from an average of 7.0 bcfd from the May 6-22 period when energy firms started shutting oil and gas production for the wildfires. Meteorologists projected the weather in the Lower 48 states would remain mostly near normal through June 20 before turning hotter than normal through from June 21-27. Technically market is under fresh selling as the market has witnessed a gain in open interest by 0.95% to settle at 42599 while prices are down -0.9 rupees, now Natural gas is getting support at 183.1 and below same could see a test of 179.9 levels, and resistance is now likely to be seen at 189.5, a move above could see prices testing 192.7.

Trading Ideas:
* Natural gas trading range for the day is 179.9-192.7.
* Natural gas eased on forecasts for less demand than previously expected.
* Average gas output in the U.S. Lower 48 states eased to 102.3 billion cubic feet per day (bcfd) so far in June
* Meteorologists projected the weather in the Lower 48 states would remain mostly near normal through June 20.


Copper

Copper yesterday settled down by -0.67% at 719.05 as investors continue to assess the global economic outlook while awaiting key monetary policy decisions from the Fed and the ECB next week. In the United States, a surge in weekly jobless claims raised hopes that a peak in the Federal Reserve rates was near. Copper stocks on the Shanghai Futures Exchange declined 11.7% this week to a six-month low of 76,473 metric tons. China's economic growth is expected to be "relatively high" in the second quarter compared to the prior year, mainly due a low base of comparison, while consumer inflation is projected to be above 1% by December, the central bank governor said. As rising interests rates and inflation squeeze demand in the United States and Europe, China's core CPI has been soft and factory gate prices fell sharply in May, suggesting the world's second-largest economy is losing steam. At present, China's economy is recovering from the impact of COVID-19, and the balance sheets of its companies are being repaired, the People's Bank of China (PBOC) said. China's economy is facing challenges including rapidly worsening exports, a high youth jobless rate, property distress and weak domestic demand, but Yi said China is confident and capable of meeting the growth goals set earlier this year. Technically market is under fresh selling as the market has witnessed a gain in open interest by 2.6% to settle at 5881 while prices are down -4.85 rupees, now Copper is getting support at 716.7 and below same could see a test of 714.4 levels, and resistance is now likely to be seen at 722.1, a move above could see prices testing 725.2.

Trading Ideas:
* Copper trading range for the day is 714.4-725.2.
* Copper dropped as investors continue to assess the global economic outlook
* Copper stocks on the SHFE declined 11.7% to a six-month low of 76,473 metric tons
* LME's on-warrant copper stocks resumed decline after Thursday's growth.

Zinc

Zinc yesterday settled down by -1.21% at 211.65 as Chinese refined zinc output stood at 564,500 mt in May, an increase of 24,500 mt or 4.54% MoM and 9.56% YoY, slightly exceeding expectations. China will likely further cut banks' reserve ratio and interest rates in the second half of this year to support the economy. Investors also hoped that Beijing would roll out supportive measures soon to bolster the embattled property sector, which consumes a vast amount of metals. Some smelters in Henan reduced production due to high sulphuric acid inventories. Zinc inventories in London Metal Exchange-registered warehouses have nearly doubled since last week to a one-year peak after a shipment arrived in Malaysia, data published by the exchange showed. Steady arrivals of metal into storage facilities indicate there are surpluses of the metal used to galvanise steel due rising supply and weak demand from the construction sector. LME data showed that zinc deposited in LME warehouses has surged to 87,500 tonnes, up 92% since last week and the strongest level since May 2022. The data showed the latest shipment of 13,175 tonnes arrived at warehouses in Port Klang, Malaysia, while most of the metal that built up last week moved into Singapore. The discount closed at $14.73 a tonne on Tuesday compared with a premium of about $35 a tonne in late March. Technically market is under long liquidation as the market has witnessed a drop in open interest by -1.72% to settle at 3032 while prices are down -2.6 rupees, now Zinc is getting support at 210.5 and below same could see a test of 209.1 levels, and resistance is now likely to be seen at 213.7, a move above could see prices testing 215.5.

Trading Ideas:
* Zinc trading range for the day is 209.1-215.5.
* Zinc dropped as Chinese refined zinc output rose 4.54% MoM and 9.56% YoY
* China will likely further cut banks' reserve ratio and interest rates in the second half of this year to support the economy.
* Some smelters in Henan reduced production due to high sulphuric acid inventories.


Aluminium

Aluminium yesterday settled down by -1.07% at 203.45 as traders and investors exercised caution ahead of the U.S. Federal Reserve's rate decision and amid a firmer dollar. The market kept a close eye on rain forecast in China's main aluminium producing region Yunnan, where reduced hydropower generation kept part of the metal production capacity offline for months. Hydropower generation in Yunnan has improved, and a small amount of aluminium capacity there could resume in late June. Investor sentiment was aided by China's financial boost and its decision to launch a nationwide campaign to promote automobile purchases and shore up demand in the world's largest auto market. China's economic growth is expected to be "relatively high" in the second quarter compared to the prior year, mainly due a low base of comparison, while consumer inflation is projected to be above 1% by December, the central bank governor said. As rising interests rates and inflation squeeze demand in the United States and Europe, China's core CPI has been soft and factory gate prices fell sharply in May, suggesting the world's second-largest economy is losing steam. At present, China's economy is recovering from the impact of COVID-19, and the balance sheets of its companies are being repaired, PBOC said in a statement. Technically market is under fresh selling as the market has witnessed a gain in open interest by 4.96% to settle at 3176 while prices are down -2.2 rupees, now Aluminium is getting support at 202.9 and below same could see a test of 202.2 levels, and resistance is now likely to be seen at 204.7, a move above could see prices testing 205.8.

Trading Ideas:
* Aluminium trading range for the day is 202.2-205.8.
* Aluminium dropped amid a firmer dollar ahead Fed rate decision.
* Investor sentiment was aided by China's financial boost
* China's central bank upbeat on Q2 GDP growth, confident on 2023 targets

Mentha oil

Mentha oil yesterday settled up by 0.83% at 912.8 on level buying after prices dropped on better sowing prospects. Reports of increased acreages and sluggish export of menthol will weigh on prices. Rising menthol imports, as well as China's limited purchasing, will put pressure on pricing. Mentha exports during Apr-Mar 2023, dropped by 10.39 percent to 2,430.49 tonnes as compared to 2,712.39 tonnes exported during Apr-Mar 2022. In March 2023 around 202.95 tonnes of Mentha was exported as against 210.78 tonnes in February 2023 showing a drop of 3.71%. In March 2023 around 202.95 tonnes of Mentha was exported as against 218.78 tonnes in March 2022 showing a drop of 7.24%. 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 dropped by -16.2 Rupees to end at 1045.4 Rupees per 360 kgs.Technically market is under fresh buying as the market has witnessed a gain in open interest by 0.75% to settle at 668 while prices are up 7.5 rupees, now Mentha oil is getting support at 902.8 and below same could see a test of 892.9 levels, and resistance is now likely to be seen at 920.8, a move above could see prices testing 928.9.

Trading Ideas:
* Mentha oil trading range for the day is 892.9-928.9.
* In Sambhal spot market, Mentha oil dropped  by -16.2 Rupees to end at 1045.4 Rupees per 360 kgs.
* Mentha oil gains on level buying after prices dropped on better sowing prospects.
* Reports of increased acreages and sluggish export of menthol will weigh on prices.
* Rising menthol imports, as well as China's limited purchasing, will put pressure on pricing.

Turmeric

Turmeric yesterday settled down by -1.43% at 7842 on profit booking in expectation of rise in domestic supplies. Traders are also showing lesser interest at prevailing price levels and avoiding bulk buying in expectation of fall in prices. Supplies in Maharashtra and Telangana are likely to increase as farmers are getting fair realization on their produce. Losses in prices are looking limited due to weaker production prospects supported by delayed monsoon forecast. India Meteorological Department projected onset of monsoon is likely to be delayed by three days. Turmeric exports during Apr-Mar 2023, rose by 11.34 percent at 170,085.36 tonnes as compared to 152,757.59 tonnes exported during Apr- Mar 2022. In March 2023 around 18,810.47 tonnes of turmeric was exported as against 14,806.30 tonnes in February 2023 showing a rise of 27.04%. In March 2023 around 18,810.47 tonnes of turmeric was exported as against 15,740.36 tonnes in March 2022 showing a rise of 19.50%. Production of spices in India is likely to have declined 1.5% on year to 10.9 mln tn in 2021-22 (Jul-Jun), according to data from Spices Board India. The country had produced 11.0 mln tn of spices in the previous year. The Spices Board has pegged turmeric production at 1.33 mln tn, up 18.4% on year. In Nizamabad, a major spot market in AP, the price ended at 7432.5 Rupees dropped -36.7 Rupees.Technically market is under fresh selling as the market has witnessed a gain in open interest by 9.78% to settle at while prices are down -114 rupees, now Turmeric is getting support at 7770 and below same could see a test of 7696 levels, and resistance is now likely to be seen at 7936, a move above could see prices testing 8028.

Trading Ideas:
* Turmeric trading range for the day is 7696-8028.
* Turmeric dropped on profit booking in expectation of rise in domestic supplies.
* India Meteorological Department projected onset of monsoon is likely to be delayed
* Supplies in Maharashtra and Telangana are likely to increase as farmers are getting fair realization on their produce.
* In Nizamabad, a major spot market in AP, the price ended at 7432.5 Rupees dropped -36.7 Rupees.


Jeera
Jeera yesterday settled up by 3.04% at 48580 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. The market is expecting a lower yield and quality of jeera this season, which has boosted the demand from domestic and export buyers. The jeera growing regions in southern and north-western parts of Rajasthan in the districts of Alwar, Jaisalmer, Jaipur, Bikaner, Bhilwara, and Barmer have received a fresh spell of unseasonal rains in the past week, triggering concerns on the crop condition. Marginal traders are avoiding bulk buying in anticipation of rise in seasonal supply of jeera in Gujarat and Rajasthan. Below normal supplies in the market supported firmness in prices. About 508 tonnes of jeera arrived on 6th June at major APMC mandis across India as compared to 653 tonnes of prior day. Tighter carryover stocks and lower production will push up the prices further. According to FISS forecasts, cumin demand is predicted to exceed 85 lakh bags this year, with a likely supply of 65 lakh bags. One bag holds 55kg. This will result in a demand-supply imbalance. Currently, at least 70% of the crop in Rajasthan and around 30% in Gujarat have yet to be harvested. Because of the rain in both states, the total yield will be reduced. The cumin crop was destroyed by two bouts of unseasonal rainfall during the harvest season. In comparison to the planned arrival of 70 lakh bags, the stock will be reduced to 60-65 lakh bags, with a carry-forward stock of 5 lakh bags from last year. In Unjha, a key spot market in Gujarat, jeera edged down by -467.15 Rupees to end at 47856.15 Rupees per 100 kg.Technically market is under fresh buying as the market has witnessed a gain in open interest by 10.12% to settle at while prices are up 1435 rupees, now Jeera is getting support at 47110 and below same could see a test of 45640 levels, and resistance is now likely to be seen at 49540, a move above could see prices testing 50500.

Trading Ideas:
*Jeera trading range for the day is 45640-50500.
* Jeera prices gained due to good export demand
* 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 -467.15 Rupees to end at 47856.15 Rupees per 100 kg.

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