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Gold

Gold yesterday settled up by 0.23% at 61027 as the New York manufacturing sector reported a steep drop in May, according to the latest data from the New York Federal Reserve. The regional central bank said its Empire State manufacturing survey's general business conditions index tumbled 43 points to -31.8 in May. A batch of new economic data underscored current trends of lower inflation and a slower labor market in the United States, strengthening expectations that the Federal Reserve will pause its tightening cycle in its next meeting. Physical gold demand in India improved slightly as domestic prices eased from recent record highs, while demand was weak in other Asian centres with some dealers offering discounts in top bullion consumer China to attract buyers. Indian dealers were offering a discount of up to $11 an ounce over official domestic prices down from last week's discount of $23. Indian gold demand in the March-quarter fell 17% to the lowest level in 10 quarters and is likely to remain subdued even during June and September quarters on record-high prices, the World Gold Council said. The WGC said that global gold-backed exchange-traded products saw inflows of 15 tonnes in April, valued at $824 million. Technically market is under short covering as the market has witnessed a drop in open interest by -0.02% to settle at 12828 while prices are up 140 rupees, now Gold is getting support at 60852 and below same could see a test of 60677 levels, and resistance is now likely to be seen at 61170, a move above could see prices testing 61313.

Trading Ideas:
* Gold trading range for the day is 60677-61313.
* Gold gains as the New York manufacturing sector reported a steep drop in May
* Gold ETF investment demand improved in April, but the market remains negative year-to-date
* Physical gold demand in India improved slightly as domestic prices eased from recent record highs



Silver

Silver yesterday settled up by 0.48% at 73402 as the dollar weakened as investors monitored the ongoing debt ceiling impasse and awaited insights from several Federal Reserve officials regarding the central bank's intentions. President Joe Biden announced that he would meet with congressional leaders to discuss a plan for raising the nation's debt limit. In the meantime, traders continue to bet the Federal Reserve will pause rate hikes during its upcoming meeting next month. Chicago Fed President Austan Goolsbee said in interview that the U.S. central bank is trying to slow inflation without sending the economy into a recession. Goolsbee's comments followed those of Fed Governor Michelle Bowman who warned there is no 'consistent evidence' that inflation is under control. U.S. President Joe Biden said he remains "optimistic" about finding an agreement with his Republican opponents to raise the U.S. debt limit and avoid a default. This week's trading may be impacted by reaction to the latest U.S. economic data, including reports on retail sales, industrial production, housing starts and existing home sales. Traders also await speeches from several Fed officials, including Fed Chair Jerome Powell's speech on Friday, heading to the Fed's June meeting. Chinese data on industrial production, retail sales and fixed asset investment are due on Tuesday. Technically market is under short covering as the market has witnessed a drop in open interest by -3.4% to settle at 14963 while prices are up 348 rupees, now Silver is getting support at 72963 and below same could see a test of 72524 levels, and resistance is now likely to be seen at 73758, a move above could see prices testing 74114.

Trading Ideas:
* Silver trading range for the day is 72524-74114.
* Silver gains as dollar weakened as investors monitored the ongoing debt ceiling
* The upside remained capped in the wake of hawkish comments from Fed officials.
* U.S. central bank is trying to slow inflation without sending the economy into a recession.


Curde oil
Crude oil yesterday settled up by 1.56% at 5863 as the prospect of tightening supplies due to OPEC+ production cuts and a resumption in U.S. buying for reserves outweighed concerns about fuel demand in top global oil consumers the United States and China. Oil prices reversed early losses after the European Commission, the executive arm of the EU, said that Eurozone economic growth will be faster than previous forecast this year and next. Elsewhere, China's central bank injected more liquidity in the banking system to shore up economic growth. Still, global crude supplies could tighten in the second half as OPEC+ - the Organization of the Petroleum Exporting Countries and allies including Russia - is making additional output cuts that are reducing sour crude volumes. The group announced in
April that some members would cut output further by around 1.16 million barrels per day (bpd), bringing the total volume of cuts to 3.66 million bpd, according to calculations. However, Iraq does not
expect OPEC+ to make further cuts to oil output at its next meeting on June 4, said its oil minister, Hayan Abdel-Ghani. The U.S. could start repurchasing oil for the Strategic Petroleum Reserve (SPR) after completing a congressionally mandated sale in June, Energy Secretary Jennifer Granholm told lawmakers. Technically market is under short covering as the market has witnessed a drop in open interest by -39.61% to settle at 9606 while prices are up 90 rupees, now Crude oil is getting support at 5751 and below same could see a test of 5640 levels, and resistance is now likely to be seen at 5936, a move above could see prices testing 6010."

Trading Ideas:
* Curde oil trading range for the day is 5640-6010.
* Crude oil gains on the prospect of tightening supplies
* Iraq does not expect OPEC+ to make further cuts to oil output at its next meeting on June 4
* The U.S. could start repurchasing oil for SPR after completing a congressionally mandated sale in June


Natural gas
Nat.Gas yesterday settled up by 2.59% at 194.2 due to a decrease in output and projections of higher demand over the next two weeks. Preliminary data showed gas output fell to a three-week low of 100.8 billion cubic feet per day. At the same time, gas demand is expected to increase from 91.3 bcfd this week to 91.6 bcfd next week as warmer weather is making more people turn on their air conditioners. On the other hand, gas flows to US LNG export plants decreased so far in May, primarily due to reductions at some terminals in Louisiana and Texas. Meanwhile, the latest EIA report showed a slightly larger-than-expected storage build last week, which was still smaller than usual for this time of year because cold weather kept heating demand for the fuel high. Meteorologists projected the weather in the U.S. Lower 48 states would switch from warmer-than-normal levels from May 12-17 to near-normal from May 18-27. Refinitiv forecast U.S. gas demand, including exports, would rise from 91.2 bcfd this week to 91.9 bcfd next week as some homes and businesses turn on their air conditioners before sliding to 90.1 bcfd in two weeks when the weather turns milder. Technically market is under short covering as the market has witnessed a drop in open interest by -4.77% to settle at 30732 while prices are up 4.9 rupees, now Natural gas is getting support at 189 and below same could see a test of 183.9 levels, and resistance is now likely to be seen at 197.7, a move above could see prices testing 201.3.

Trading Ideas:
* Natural gas trading range for the day is 183.9-201.3.
* Natural gas rose due to a decrease in output and projections of higher demand.
* Preliminary data showed gas output fell to a three-week low of 100.8 billion cubic feet per day.
* Gas demand is expected to increase from 91.3 bcfd this week to 91.6 bcfd next week



Copper
Copper yesterday settled down by -0.12% at 728.1 as market's worries about overseas economic recession, the possible US debt default and the overall poor domestic economic data weighed. Copper inventories in warehouses monitored by the Shanghai Futures Exchange fell 12.3 % from last Friday. Consumption for industrial metals in China has remained subdued in the second quarter which traditionally a peak demand season due to a slow economic recovery and sluggish export market. China's inflation data added to concerns over the strength of the country's economic recovery. Data showed that China’s copper cathode output stood at 970,000 mt in April 2023, up 18,600 mt or 2% from the previous month and 17.2% from the same period in 2022. The actual output was 16,100 mt higher than the expected 953,900 mt. The output totalled 3.68 million mt in January-April, an increase of 352,900 mt or 10.6% year on year. According to statistics, six smelters carried out maintenance in April, which led to an output cut of 29,500 mt. However, the output in April still increased 35,400 month-on-month due to the shorter statistical cycle of some large smelters in March. Technically market is under long liquidation as the market has witnessed a drop in open interest by -6.12% to settle at 5066 while prices are down -0.9 rupees, now Copper is getting support at 723.8 and below same could see a test of 719.4 levels, and resistance is now likely to be seen at 733.2, a move above could see prices testing 738.2.

Trading Ideas:
* Copper trading range for the day is 719.4-738.2.
* Copper dropped as signs of increasingly low demand outweighed tight supply.
* Copper inventories in LME warehouses climbed to a near two-month high.
* Copper inventories in warehouses monitored by the Shanghai Futures Exchange fell 12.3 % from last Friday.


Zinc
Zinc yesterday settled down by -0.33% at 229.05 dropped weighed down by expectations for a strong rebound in supply this year after a protracted smelter bottleneck in 2022. The International Lead and Zinc Study Group (ILZSG) still thinks the global refined zinc market will be in supply shortfall this year but it's slashed its deficit forecast to a modest 45,000 tonnes from 150,000 tonnes at the time of its last statistical update in October. It's a fine margin in a 14-million-tonne global market but the shift captures the current bear narrative in zinc, which is down by 15% so far this year, the second-weakest price performance after nickel among the LME-traded metals. Global demand fell by 3.9% in 2022, led by an estimated 4.9%fall in China, according to ILZSG's April forecasts. Around 60% of zinc usage is in the form of galvanised steel, which is widely used in the construction and automotive sectors, both of which were hit hard by China's rolling lockdowns last year. The country's demand is expected to recover by 2.1% this year, matching that in the rest of the world, ILZSG said. Refined zinc production also fell last year to the tune of 3.8% but it will bounce back by a robust 3.1% this year. Technically market is under fresh selling as the market has witnessed a gain in open interest by 1.03% to settle at 3725 while prices are down -0.75 rupees, now Zinc is getting support at 227.4 and below same could see a test of 225.7 levels, and resistance is now likely to be seen at 231.1, a move above could see prices testing 233.1.

Trading Ideas:

* Zinc trading range for the day is 225.7-233.1.
* Zinc prices dropped weighed down by expectations for a strong rebound in supply
* London Metal Exchange (LME) three-month metal hitting a two-and-a-half year low.
* China's post-lockdown bounce-back continues to disappoint.



Aluminium
Aluminium yesterday settled up by 0.65% at 207.7 as aluminium ingot inventory may remain low and continue to drop in May. Expectations of US interest rate hikes, the banking crisis, and debt ceiling negotiations all sent out negative signals, exacerbating the panic in the aluminium market. Driven by production resumption, the domestic operating aluminium capacity and output are expected to increase further in May. Data shows that China's aluminium output increased 1.5% year-on-year to 3.35 million mt in April (30 days) as aluminium enterprises in Guangxi and Guizhou continued to resume production, with daily output rising 1,533 mt from to about 111,600 mt. Aluminium output totalled 13.27 million mt from January to April, up 3.9% year on year. The output of aluminium semis in south-west China rose in April and the ratio of aluminium liquid increased 2.4 percentage points month-on-month to 73.4%. Changes in production capacity: In April, enterprises in Guangxi, Guizhou and Sichuan resumed a total capacity of 430,000 mt, and enterprises in Guizhou also put a new capacity of nearly 100,000 mt into production. In Yunnan, aluminium enterprises maintained stable production and the operating capacity remained stable. Technically market is under short covering as the market has witnessed a drop in open interest by -4.97% to settle at 3192 while prices are up 1.35 rupees, now Aluminium is getting support at 206 and below same could see a test of 204.3 levels, and resistance is now likely to be seen at 208.9, a move above could see prices testing 210.1.

Trading Ideas:
* Aluminium trading range for the day is 204.3-210.1.
* Aluminum recovers as ingot inventory may remain low and continue to drop in May
* However, expectations of US interest rate hikes, the banking crisis, and debt ceiling negotiations all sent out negative signals.
* Driven by production resumption, the domestic operating aluminium capacity and output are expected to increase.


Mentha oil
Mentha oil yesterday settled up by 0.59% at 955.3 on short covering after prices dropped on better sowing conditions in UP and Bihar. 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-Feb 2023, dropped by 10.67 percent to 2,227.55 tonnes as compared to 2,493.53 tonnes exported during Apr-Feb 2022. In February 2023 around 210.78 tonnes of Mentha was exported as against 233.21 tonnes in January 2023 showing a drop of 9.62%. In February 2023 around 210.78 tonnes of Mentha was exported as against 157.90 tonnes in February 2022 showing a rise of 33.49%. 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 10.9 Rupees to end at 1130.4 Rupees per 360 kgs.Technically market is under short covering as the market has witnessed a drop in open interest by -3.32% to settle at 612 while prices are up 5.6 rupees, now Mentha oil is getting support at 948.2 and below same could see a test of 941.2 levels, and resistance is now likely to be seen at 960.1, a move above could see prices testing 965.

Trading Ideas:

* Mentha oil trading range for the day is 941.2-965.
* In Sambhal spot market, Mentha oil gained  by 10.9 Rupees to end at 1130.4 Rupees per 360 kgs.
* Mentha oil gains on short covering after prices dropped on better sowing conditions
* 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 up by 3.04% at 8268 as there were report of some fall in crop yields in the Marathwada region of Maharashtra due to rain in the last week. 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 stocks were soaked in rain water in Guntur, Krishna and NTR Districts due to the rainfall. Arrivals of new crop has improved as about 7-8 lakh bags touched the Nizamabad market so far wherein about 7 lakh bags were reported in Sangli. Market is running with huge stocks and stockists are trying to release their stocks on every rise in prices. Turmeric exports during Apr-Feb 2023, rose by 10.42 percent at 151,298.89 tonnes as compared to 137,017.23 tonnes exported during Apr- Feb 2022. In February 2023 around 14,806.30 tonnes of turmeric was exported as against 12,484.25 tonnes in January 2023 showing a rise of 18.60%. In February 2023 around 14,806.30 tonnes of turmeric was exported as against 10,358.22 tonnes in February 2022 showing a rise of 42.94%. 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 7465.5 Rupees gained 235.55 Rupees.Technically market is under fresh buying as the market has witnessed a gain in open interest by 1.27% to settle at 15540 while prices are up 244 rupees, now Turmeric is getting support at 8002 and below same could see a test of 7736 levels, and resistance is now likely to be seen at 8504, a move above could see prices testing 8740.

Trading Ideas:
* Turmeric trading range for the day is 7736-8740.
* Turmeric rose on report of fall in yields
* Turmeric stocks were soaked in rain water in Guntur, Krishna and NTR Districts due to the rainfall.
* Turmeric exports during Apr-Jan 2023, rose by 7.76 percent at 1,36,492.59 tonnes
* In Nizamabad, a major spot market in AP, the price ended at 7465.5 Rupees gained 235.55 Rupees.


Jeera
Jeera yesterday settled down by -2.39% at 46375 on profit booking after prices rose 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. 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 -1154.35 Rupees to end at 47271.2 Rupees per 100 kg.Technically market is under fresh selling as the market has witnessed a gain in open interest by 1.55% to settle at 9834 while prices are down -1135 rupees, now Jeera is getting support at 45930 and below same could see a test of 45490 levels, and resistance is now likely to be seen at 47170, a move above could see prices testing 47970.

Trading Ideas:

* Jeera trading range for the day is 45490-47970.
* Jeera dropped on profit booking after rose due to good export demand.
* The market is expecting a lower yield and quality of jeera this season, which has boosted the demand from domestic and export buyers.
* Cumin demand is predicted to exceed 85 lakh bags this year, with a likely supply of 65 lakh bags.
* In Unjha, a key spot market in Gujarat, jeera edged down by -1154.35 Rupees to end at 47271.2 Rupees per 100 kg.

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