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Gold

Gold yesterday settled up by 0.4% at 59848 as renewed safe-haven demand as activity in the U.S. service sector falls more than expected in May. The ISM said its Services Purchasing Managers Index fell to 50.3% last month, down from April's reading of 51.9%. Data showed that U.S. non-farm employment soared by 339,000 jobs in May while economists had expected an increase of 190,000 jobs. However, a rise in unemployment rate to a seven-month high of 3.7 percent and lower average hourly earnings helped keep alive hopes of Fed pausing rate hikes. Risk sentiment also improved after U.S. President Joe Biden signed legislation that lifts the nation's debt ceiling. Physical gold demand slowed in India this week as a recovery in domestic prices prompted buyers to postpone purchases, while weakening of the Chinese currency underpinned premiums in the top consumer. Indian dealers were charging a premium of up to $4 an ounce over official domestic prices, up from the last week's premium of $3. In China, the top consumer of the precious metal, premiums of $1.50-$9 an ounce were charged over international benchmark spot prices, compared to last week's $2-$6.50 range. In Singapore, premiums between $1.50-$2.50 were charged. Technically market is under fresh buying as the market has witnessed a gain in open interest by 0.05% to settle at 14626 while prices are up 240 rupees, now Gold is getting support at 59488 and below same could see a test of 59128 levels, and resistance is now likely to be seen at 60053, a move above could see prices testing 60258.

Trading Ideas:
* Gold trading range for the day is 59128-60258.
* Gold gains as activity in U.S. service sector falls more than expected in May.
* ISM said its Services Purchasing Managers Index fell to 50.3% last month, down from April's reading of 51.9%.
* Data showed that U.S. non-farm employment soared by 339,000 jobs in May


Silver
Silver yesterday settled down by -0.21% at 71872 as investors weighed the easing inflationary pressure in the Eurozone against the hawkish comments from ECB President Lagarde. On one hand, data indicated a larger-than-expected slowdown in both consumer and producer prices, suggesting that the European Central Bank might reach its peak interest rates in September, earlier than previously forecasted for December. However, Lagarde expressed the opinion that Eurozone inflation remained at elevated levels, signaling the need for further tightening of monetary policy. New orders for manufactured goods in the US increased by 0.4% from the previous month in April of 2023, slowing from the downwardly revised 0.6% increase in the prior month and missing market forecasts of a 0.8% jump. The ISM Services PMI fell to 50.3 in May of 2023 from 51.9 in April, pointing to the fifth consecutive month of expansion in the services sector, but the slowest in the current sequence. The S&P Global US Services PMI was revised slightly lower to 54.9 in May of 2023 from a preliminary 55.1, but continued to point to the strongest expansion in the services sector since April 2022, mainly supported by new business. The upturn in new orders was driven by improved demand conditions in both domestic and export markets. Technically market is under fresh selling as the market has witnessed a gain in open interest by 2.35% to settle at 13600 while prices are down -148 rupees, now Silver is getting support at 71295 and below same could see a test of 70719 levels, and resistance is now likely to be seen at 72340, a move above could see prices testing 72809.

Trading Ideas:
* Silver trading range for the day is 70719-72809.
* Silver fell as investors weighed the easing inflationary pressure in Euro
* ECB’s Lagarde, Eurozone inflation remained at elevated levels, signaling the need for further tightening of monetary policy.
* New orders for manufactured goods in the US increased by 0.4% from the previous month in April of 2023


Crude oil
Crude oil yesterday settled up by 1.49% at 6004 after Saudi's energy ministry said the kingdom will extend its 500,000 bpd voluntary oil cut until the end of 2024. Saudi Arabia has pledged a new voluntary oil output cut of 1 million barrels per day for July, which could be extended further, its energy ministry said. Russia will extend its voluntary oil production cut of 500,000 barrels per day until the end of December 2024, Russian Deputy Prime Minister Alexander Novak said after a meeting of OPEC+ group of leading oil producers. The cuts will be as a precautionary measure, in coordination with the countries participating in the OPEC+ agreement, which had previously announced voluntary cuts in April, he added. "This voluntary cut will be from the required production level, as agreed upon at the thirty-fifth ministerial meeting of OPEC Plus on June 4, 2023," Novak added. Russian is fulfilling its oil output cuts obligations in full, Russian Deputy Prime Minister Alexander Novak told following a meeting of OPEC+ group of leading oil producers. He said the group's total cuts stand at 3.66 million barrels per day to ensure oil market's stable work. Technically market is under short covering as the market has witnessed a drop in open interest by -10.2% to settle at 10261 while prices are up 88 rupees, now Crude oil is getting support at 5939 and below same could see a test of 5873 levels, and resistance is now likely to be seen at 6089, a move above could see prices testing 6173.

Trading Ideas:
* Crude oil trading range for the day is 5873-6173.
* Crude oil gains after Saudi to extend its 500,000 bpd cut until the end of 2024
* Saudi Arabia pledges new voluntary cut of 1 mln bpd for July
* Russia extends oil output cut of 0.5 mln bpd until end – 2024 – Novak


Natural Gas
Nat.Gas yesterday settled up by 3.41% at 188.1 on forecasts for low wind power, warmer weather and higher air conditioning demand over the next two weeks than previously expected, rising exports to Mexico and a jump in global gas prices. The amount of U.S. power generated by wind so far this week dropped to just 6% of the total versus a recent high of 12% during the week ended May 12, according to federal energy data. The amount of power generated by gas has risen to 44% so far this week, up from around 40% in recent weeks. Data provider Refinitiv said average gas output in the U.S. Lower 48 states has eased to 102.4 billion cubic feet per day (bcfd) so far in June, down from a monthly record of 102.5 bcfd in May. Meteorologists projected the weather in the Lower 48 states would remain mostly near through June 13 before turning hotter than normal from June 14-20. Refinitiv forecast U.S. gas demand, including exports, would ease from 95.9 bcfd this week to 95.3 bcfd next week on expectations wind power will remain low this week. Those demand forecasts were higher than Refinitiv's outlook on Friday. Technically market is under short covering as the market has witnessed a drop in open interest by -14.98% to settle at 39924 while prices are up 6.2 rupees, now Natural gas is getting support at 183.2 and below same could see a test of 178.3 levels, and resistance is now likely to be seen at 192.4, a move above could see prices testing 196.7.

Trading Ideas:
* Natural gas trading range for the day is 178.3-196.7.
* Natural gas rose on forecasts for low wind power, warmer weather.
* The price jump occurred despite near record U.S. output and continued low amounts of gas flowing to LNG export plants.
* Average gas output in the U.S. Lower 48 states has eased to 102.4 billion cubic feet per day (bcfd) so far in June


Copper

Copper yesterday settled up by 0.71% at 721.15 as Chile’s copper output in April decreased by 1.1% year-on-year to 417,279 mt. It was still the lowest in the same period in recent years, and also dropped significantly on the month. In April, the disruptions to mines weakened, but the commissioning of new production capacity was also very limited. Codelco, the world's largest copper producer, closed its Ventanas copper smelter on Chile's central coast in a bid to reduce pollution and move towards more sustainable mining. The copper smelting capacity of the Ventanas smelter is 150,000 mt/year with metal content. Peru's copper production soared by 30.5% in April versus the same month a year earlier, due to the good performance of mines including Las Bambas and Cerro Verde, the Ministry of Energy and Mines said in a statement. Fine copper production in April shot up to 221,999 tonnes, the statement said, compared to 170,168 tonnes in April 2022. Peru is the world's second-largest copper producer and the red metal is an important generator of income for the county's economy. April's strong showing pushed Peru's copper production during the first four months of the year to 837,514 tonnes, representing growth of 15.7% versus the year-earlier period. Technically market is under short covering as the market has witnessed a drop in open interest by -0.72% to settle at 6165 while prices are up 5.05 rupees, now Copper is getting support at 714 and below same could see a test of 706.9 levels, and resistance is now likely to be seen at 725.7, a move above could see prices testing 730.3.

Trading Ideas:
* Copper trading range for the day is 706.9-730.3.
* Copper gains as Chile's copper production fell in April
* Chiles’s production is still low compared with the same period in recent years
* Codelco closes Ventanas copper smelter to reduce pollution


Zinc
Zinc yesterday settled down by -0.45% at 208.1 as dollar was firmer after a robust U.S. jobs report spurred traders to price in higher interest rates for longer. However, downside seen limited as 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. LME zinc stocks have shot up 461% since early February, boosting confidence on the LME market about the availability of the metal for speedy delivery and creating a discount for the cash contract over the three-month contract. 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 fresh selling as the market has witnessed a gain in open interest by 4.41% to settle at 3767 while prices are down -0.95 rupees, now Zinc is getting support at 206.9 and below same could see a test of 205.5 levels, and resistance is now likely to be seen at 209.2, a move above could see prices testing 210.1.

Trading Ideas:
* Zinc trading range for the day is 205.5-210.1.
* Zinc dropped as dollar was firmer after a robust U.S. jobs report spurred traders to price in higher interest rates for longer.
* However, downside seen limited as 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


Aluminium

Aluminium yesterday settled down by -0.65% at 206.25 as China’s operating aluminium capacity rose to 40.92 million mt at the end of May, and the domestic aluminium output rose 1% year-on-year to around 3.47 million mt in May, mainly driven by production resumption in Guizhou and Sichuan. Smelters maintained high proportion of molten aluminium output last month. The Caixin China General Composite PMI rose to 55.6 in May 2023 from 53.6 in the prior month. This was the fifth straight month of growth in private sector activity and the steepest pace since December 2020, supported by a faster rise in output across both the manufacturing and service sectors, with the latter seeing a quicker rate of rise. The Caixin China General Services PMI increased to 57.1 in May 2023 from 56.4 in the previous month. Still, it was the fifth straight month of expansion in services activity and the second-fastest since November 2020 as the post-COVID recovery continued. New orders grew faster and sustained a rise in new export business amid reports of stronger market conditions and increased customer turnout while employment climbed modestly with backlogs rising further. Technically market is under fresh selling as the market has witnessed a gain in open interest by 6.25% to settle at 2892 while prices are down -1.35 rupees, now Aluminium is getting support at 205.5 and below same could see a test of 204.7 levels, and resistance is now likely to be seen at 207.4, a move above could see prices testing 208.5.

Trading Ideas:
* Aluminium trading range for the day is 204.7-208.5.
* Aluminium dropped driven by production resumption in Guizhou and Sichuan
* China’s operating aluminium capacity rose to 40.92 million mt at the end of May
* China’s aluminium output rose 1% year-on-year to around 3.47 million mt in May

Mentha oil

Mentha oil yesterday settled down by -1.35% at 937.5 on better sowing conditions in UP and Bihar and weak export demand. The recent period of rain in Uttar Pradesh and Bihar has been beneficial to planting efforts. The forecast of above-average rainfall in May would be beneficial to Mentha seeding efforts. 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 -29.9 Rupees to end at 1079.2 Rupees per 360 kgs.Technically market is under fresh selling as the market has witnessed a gain in open interest by 13.98% to settle at 685 while prices are down -12.8 rupees, now Mentha oil is getting support at 933.4 and below same could see a test of 929.3 levels, and resistance is now likely to be seen at 943.3, a move above could see prices testing 949.1.

Trading Ideas:
* Mentha oil trading range for the day is 929.3-949.1.
* In Sambhal spot market, Mentha oil dropped  by -29.9 Rupees to end at 1079.2 Rupees per 360 kgs.
* Menthaoil dropped on better sowing and weak export demand.
* The forecast of above-average rainfall in May would be beneficial to Mentha seeding efforts.
* Rising menthol imports, as well as China's limited purchasing, will put pressure on prices.

Turmeric

Turmeric yesterday settled down by -0.21% at 7522 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. The southwest monsoon, which normally sets in over Kerala on June 1, is likely to arrive on June 4. 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 7342.85 Rupees dropped -27.15 Rupees.Technically market is under long liquidation as the market has witnessed a drop in open interest by -9.57% to settle at 8745 while prices are down -16 rupees, now Turmeric is getting support at 7474 and below same could see a test of 7426 levels, and resistance is now likely to be seen at 7592, a move above could see prices testing 7662.

Trading Ideas:
* Turmeric trading range for the day is 7426-7662.
* Turmeric dropped 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.
* In Nizamabad, a major spot market in AP, the price ended at 7342.85 Rupees dropped -27.15 Rupees.

Jeera

Jeera yesterday settled up by 1.21% at 45305 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. 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 up by 307.45 Rupees to end at 46441.45 Rupees per 100 kg.Technically market is under short covering as the market has witnessed a drop in open interest by -8.25% to settle at 5538 while prices are up 540 rupees, now Jeera is getting support at 44910 and below same could see a test of 44520 levels, and resistance is now likely to be seen at 45830, a move above could see prices testing 46360.

Trading Ideas:
* Jeera trading range for the day is 44520-46360.
* Jeera gains due to good export demand and expectations of lower stocks
* Prices rose on crop worries grow due to unseasonal rains and hailstorms in Rajasthan
* The market is expecting a lower yield and quality of jeera this season
* In Unjha, a key spot market in Gujarat, jeera edged up by 307.45 Rupees to end at 46441.45 Rupees per 100 kg.

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