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Gold

Gold yesterday settled up by 0.5% at 51417 as investors were caught between worries of a recession and hawkish central bank views ahead of the Jackson Hole conference this week. U.S. private-sector business activity contracted for a second straight month in August to its weakest in 18 months with particular softness registered in the services sector as demand weakened in the face of inflation and tighter financial conditions. The S&P Global flash composite purchasing managers index (PMI) for August dropped to 45 this month – the lowest since February 2021 – from a final reading of 47.7 in July. Weakening economies in Germany and France piled more pressure on markets as decades-high inflation and surging gas prices drag Europe towards recession, pushing the euro to a 20-year low against the dollar. Last week, several US policymakers offered hawkish statements on the need for further tightening, driving a fresh rally in the dollar and Treasury yields while denting demand for bullion. U.S. Federal Reserve Chair Jerome Powell will address the annual global central banking conference in Jackson Hole, Wyoming on Friday, a highly anticipated speech that could signal how high U.S. interest rates will go to tame surging inflation. While gold is widely considered as a hedge against inflation and economic uncertainty, higher interest rates raise the opportunity cost of holding non-yielding bullion. Technically market is under short covering as market has witnessed drop in open interest by -1.16% to settled at 13949 while prices up 254 rupees, now Gold is getting support at 51138 and below same could see a test of 50860 levels, and resistance is now likely to be seen at 51607, a move above could see prices testing 51798.
 

Trading Ideas:
* Gold trading range for the day is 50860-51798.
* Gold prices edged higher as investors were caught between worries of a recession and hawkish central bank views
* U.S. private sector activity contracts again in August, survey shows
* Weaker German, French data compound energy and euro woes


Silver

Silver yesterday settled up by 0.39% at 55207 as a slight pullback in the dollar helped lift prices, though worries lingered over the pace of rate hikes by the U.S. Federal Reserve. The dollar fell aided by fears of recession and recent hawkish comments from Fed officials. Sales of new single family houses in the US plunged 12.6% month-over-month to a seasonally adjusted annualised rate of 511K in July of 2022, the lowest reading since January of 2016 and well below forecasts of 575K, amid rising borrowing costs, prices and a fall in demand. The consumer confidence indicator in the Euro Area rose by 2.1 points to -24.9 in August of 2022, from a record low of -27 in July, beating market expectations of -28, a preliminary estimate showed. That said, consumer confidence remains below its historical low at the onset of the COVID-19 pandemic in spring 2020. In the European Union as a whole, consumer sentiment increased by 1 points to -26. In economic releases, survey results showed earlier today that Europe's two largest economies both probably contracted in August. The composite purchasing managers indexes for Germany and France hit a 26-month low and 18-month low, respectively. Investors await a gathering of central bankers later this week in Jackson Hole, Wyoming, where Fed chairman Jerome Powell will deliver a speech. Technically market is under short covering as market has witnessed drop in open interest by -8.78% to settled at 15734 while prices up 215 rupees, now Silver is getting support at 54643 and below same could see a test of 54080 levels, and resistance is now likely to be seen at 55667, a move above could see prices testing 56128.
 

Trading Ideas:
* Silver trading range for the day is 54080-56128.
* Silver rose as a slight pullback in the dollar helped lift prices, though worries lingered over the pace of rate hikes by the U.S. Federal Reserve.
* US new home sales lowest since 2016
* Markets are now pricing in a higher chance of a bigger 75 basis point rate increase in September.


Crude oil

Crude oil yesterday settled up by 4.75% at 7502 as tight supply moved back into focus as a result of Saudi Arabia floating the idea of OPEC+ output cuts to support prices and the prospect of a drop in U.S. crude inventories. Also in focus is the prospect of a nuclear deal between Iran and world powers that would allow Iran to boost oil exports. A senior U.S. official told Reuters on Monday that Iran had dropped some of its main demands on resurrecting a deal. OPEC stands ready to cut output to correct a recent oil price decline driven by poor futures market liquidity and macro-economic fears, which has ignored extremely tight physical crude supply, OPEC's leader Saudi Arabia said on Monday. Saudi state news agency SPA cited Saudi Arabia's Energy Minister Prince Abdulaziz bin Salman as telling OPEC+ has the means and flexibility to deal with challenges. Meanwhile, investors are bracing for the annual Jackson Hole symposium later this week, which is expected to reinforce the Federal Reserve's strong commitment to fight inflation with aggressive interest rate hikes. Progress around reviving the 2015 nuclear accord also loomed large over the markets as a potential deal could boost Iranian oil exports by about 2.5 million bpd. Technically market is under fresh buying as market has witnessed gain in open interest by 33.32% to settled at 5122 while prices up 340 rupees, now Crude oil is getting support at 7292 and below same could see a test of 7082 levels, and resistance is now likely to be seen at 7620, a move above could see prices testing 7738.
 

Trading Ideas:
* Crude oil trading range for the day is 7082-7738.
* Crude oil rose as tight supply moved back into focus as a result of Saudi Arabia floating the idea of OPEC+ output cuts to support prices
* Saudi Energy Minister Abdulaziz: OPEC+ may need to tighten output in order to stabilise the market.
* Saudi says OPEC+ can cut output to address oil slump


Nat.Gas

Nat.Gas yesterday settled down by -4.75% at 737.2 on news of a further delay in the resumption of initial operations at the Freeport LNG export plant in Texas. Earlier in the day prices crossed 800 level buoyed by prospects of increased demand for US LNG exports amid a deepening energy crisis in Europe. Russia's Gazprom said it would halt flows through the Nord Stream 1 pipeline to Europe for three days of maintenance at the end of August. The main channel between Russia and Europe was already running at 20% capacity, putting pressure on the region as it seeks to refuel ahead of winter to avoid a natural gas shortage. Adding to the bullish outlook, the temperatures in the US this summer remain high, with several heatwaves boosting demand for air conditioners. On top of that, Freeport LNG has recently agreed with regulators to partially restart operations in October at its shuttered export plant in Texas and said it began to pull in tiny amounts of natural gas from pipelines. The resumption of flows will withdraw more natural gas from storage and boost exports.The average amount of gas flowing to U.S. LNG export plants held at 10.9 bcfd so far in August, the same as July. That compares with a monthly record of 12.9 bcfd in March. The seven big U.S. export plants can turn about 13.8 bcfd of gas into LNG. Technically market is under long liquidation as market has witnessed drop in open interest by -48.84% to settled at 2674 while prices down -36.8 rupees, now Natural gas is getting support at 709.6 and below same could see a test of 681.9 levels, and resistance is now likely to be seen at 783, a move above could see prices testing 828.7.
 

Trading Ideas:
* Natural gas trading range for the day is 681.9-828.7.
* Natural gas prices dropped on news of a further delay in the resumption of initial operations at the Freeport LNG export plant in Texas.
* U.S. natgas futures hit $10/mmbtu for first time since 2008
* Russia's Gazprom said it would halt flows through the Nord Stream 1 pipeline to Europe for three days of maintenance at the end of August.



Copper

Copper yesterday settled up by 0.41% at 678 helped by low inventories, signs of improving demand in China and fears that sky-high energy prices could force smelters to cut output. Data showed that manufacturing has contracted in Europe this month while Japan registered slowing growth in manufacturing activity. The Chinese central bank cut its one-year loan prime rate by 5bps and the five-year rate by 15bps, lowering borrowing costs for the second time this year, as recent economic data pointed to a lower than expected rebound from the inactivity of strict Covid lockdowns. The economy for the world’s largest copper consumer and importer also remains pressured by debt woes and profit warnings for property developing giants. Yangshan copper import premiums reached a 10-month high of $112.50 and inventories in Shanghai Futures Exchange (ShFE) warehouses are near 13-year lows at 31,205 tonnes. On-warrant inventories on the LME have also fallen to 72,250 tonnes from 121,200 tonnes at the start of July. The premium on the LME for cash copper over the three-month contract has risen to about $60, suggesting tighter supply. Data pointed to a 24% yearly decline in copper scrap production during July, as producers refrained from selling at unfavorable prices during the month. Technically market is under fresh buying as market has witnessed gain in open interest by 68.96% to settled at 4577 while prices up 2.75 rupees, now Copper is getting support at 673.3 and below same could see a test of 668.4 levels, and resistance is now likely to be seen at 682.2, a move above could see prices testing 686.2.
 

Trading Ideas:
* Copper trading range for the day is 668.4-686.2.
* Copper prices rose helped by low inventories, signs of improving demand in China and fears that sky-high energy prices could force smelters to cut output.
* Data showed that manufacturing has contracted in Europe this month while Japan registered slowing growth in manufacturing activity.
* China cut its benchmark lending rate and lowered the mortgage reference by a bigger margin, adding to last week's easing measures

Zinc

Zinc yesterday settled down by -0.59% at 313.25 amid fears of global recession and interest rate hikes in the United States and Europe weighed on investors' risk appetite. The global zinc market saw a deficit of 1,400 tonnes in June from a revised deficit of 1,900 tonnes a month earlier, data from the International Lead and Zinc Study Group (ILZSG) showed. Previously, the ILZSG had reported a deficit of 3,900 tonnes in May. During the first six months of 2022, ILZSG data showed a surplus of 27,000 tonnes versus a deficit of 4,000 tonnes in the same period of 2021. China cut benchmark lending rates and lowered the mortgage reference by a bigger margin to boost its economy hurt by COVID-19 outbreaks and a property crisis, which also lifted prices of industrial metals. Meanwhile, hot temperature in China is expected to ease soon, Ho said, allowing more construction activities to resume and potentially more industrial enterprises to restart after being halted to reserve scarce electricity. Power restrictions in China have shuttered at least 500,000 tonnes per year of zinc smelting capacity, with production losses expected to reach 5,000-6,000 tonnes a week. China's southwestern Sichuan province ordered industrial plants to suspend production from Aug. 15 to Aug. 20 to prioritise residential power supply amid its worst heatwave in 60 years. Technically market is under fresh selling as market has witnessed gain in open interest by 55.34% to settled at 946 while prices down -1.85 rupees, now Zinc is getting support at 310.6 and below same could see a test of 308 levels, and resistance is now likely to be seen at 316.4, a move above could see prices testing 319.6.
 

Trading Ideas:
* Zinc trading range for the day is 308-319.6.
* Zinc dropped amid fears of global recession and interest rate hikes in the United States and Europe weighed on investors' risk appetite.
* Global zinc market sees deficit of 1,400 T in June, says ILZSG
* High power costs have already prompted temporary shutdowns at zinc smelters in Europe



Aluminium

Aluminium yesterday settled up by 0.81% at 212.7 as news came that the aluminium smelter Sunndal, affiliated to Hydro, goes on a strike. US Chicago Fed National Activity Index in July posted a value of 0.27, up 0.52 from the previous value of -0.25. China's central bank called major financial institutions, especially large state-owned banks, to give full play to their role as an industrial leader, and maintain the stability of total loan growth as it is key to increase lending to the real economy. Aluminium stocks at three major Japanese ports fell 1.6% to 364,000 tonnes at the end of July from 369,800 tonnes at the end of June. Global primary aluminium output in July rose 2.06% year on year to 5.848 million tonnes, data from the International Aluminium Institute (IAI) showed. Estimated Chinese production was 3.468 million tonnes in July, the IAI said. Trading house Sumitomo Corp expects Japanese aluminium premiums to remain at between $125 and $175 a tonne next year, against $148 this quarter, although changes in Russian supply could be a swing factor, a company manager said. Japan is Asia's biggest aluminium importer and the premiums it agrees to pay over the London Metal Exchange (LME) cash price each quarter for primary metal shipments set the benchmark for the region. Technically market is under fresh buying as market has witnessed gain in open interest by 33.7% to settled at 3047 while prices up 1.7 rupees, now Aluminium is getting support at 211.1 and below same could see a test of 209.6 levels, and resistance is now likely to be seen at 213.9, a move above could see prices testing 215.2.
Trading Ideas:
* Aluminium trading range for the day is 209.6-215.2.
* Aluminium prices rose as news came that the aluminium smelter Sunndal, affiliated to Hydro, goes on a strike.
* Aluminium stocks at three major Japanese ports fell 1.6% to 364,000 tonnes at the end of July from 369,800 tonnes at the end of June
* Global aluminium output rises 2.1% year on year in July – IAI


Mentha oil

Mentha oil yesterday settled down by -0.98% at 973.2 as Synthetic Mentha supply remains uninterrupted. However, downside seen limited amid low production this season and improving demand post-pandemic. 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 we forecast 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. Mentha exports during Apr-June 2022 has dropped by 5.75 percent at 493.45 tonnes as compared to 523.54 tonnes exported during Apr-June 2021. In the month of June 2022 around 113.33 tonnes Mentha was exported as against 209.90 tonnes in May 2022 showing a drop of 46%.In the month of June 2022 around 113.33 tonnes of Mentha was exported as against 169.93 tonnes in June 2021 showing a decline of over 33%.In the month of May 2022 around 209.90 tonnes of Mentha was exported as against 179.76 tonnes in May 2021 showing a rise of 16.77%. In Sambhal spot market, Mentha oil dropped by -2.4 Rupees to end at 1113.8 Rupees per 360 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 34.85% to settled at 1478 while prices down -9.6 rupees, now Mentha oil is getting support at 969.9 and below same could see a test of 966.7 levels, and resistance is now likely to be seen at 978.9, a move above could see prices testing 984.7.
 

Trading Ideas:
* Mentha oil trading range for the day is 966.7-984.7.
* In Sambhal spot market, Mentha oil dropped  by -2.4 Rupees to end at 1113.8 Rupees per 360 kgs.
* Mentha oil prices dropped as Synthetic Mentha supply remains uninterrupted.
* Mentha exports during Apr-June 2022 has dropped by 5.75 percent at 493.45 tonnes as compared to 523.54 tonnes exported during Apr-June 2021.
* In the month of June 2022 around 113.33 tonnes Mentha was exported as against 209.90 tonnes in May 2022 showing a drop of 46%.


Turmeric

Turmeric yesterday settled down by -0.44% at 7186 on report of better sowing. As per Andhra Pradesh agricultural department, sowing activity completed around 7,958 hectares as compared to last year same period 7,764 hectares. Sufficient stocks and good sowing reports kept turmeric prices under pressure. Turmeric exports during Apr-June 2022 has rose by 23.44 percent at 49,435.38 tonnes as compared to 40,049.06 tonnes exported during Apr-June 2021. In the month of June 2022 around 18,532.00 tonnes turmeric was exported as against 17,137.15 tonnes in May 2022 showing a rise of 8.13%. In the month of June 2022 around 18,532.00 tonnes of turmeric was exported as against 13,206.00 tonnes in June 2021 showing an increase of 40.33%. In the month of May 2022 around 17,138.35 tonnes of turmeric was exported as against 13,576.68 tonnes in May 2021 showing an increase of 26.23%. 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 7422.35 Rupees dropped -36.6 Rupees.Technically market is under fresh selling as market has witnessed gain in open interest by 0.31% to settled at 14485 while prices down -32 rupees, now Turmeric is getting support at 7140 and below same could see a test of 7096 levels, and resistance is now likely to be seen at 7226, a move above could see prices testing 7268.
 

Trading Ideas:
* Turmeric trading range for the day is 7096-7268.
* Turmeric dropped amid profit booking on reports of better sowing.
* In the ongoing season, no major quality concerns were observed in the crop arrived in the Marathwada region.
* In the month of June 2022 around 18,532.00 tonnes turmeric was exported as against 17,137.15 tonnes in May 2022 showing a rise of 8.13%.
* In Nizamabad, a major spot market in AP, the price ended at 7422.35 Rupees dropped -36.6 Rupees.


Jeera

Jeera yesterday settled up by 0.77% at 24895 as supply was observed to be less as farmers and stockists were holding stocks in expectations of higher prices in coming months. Arrivals also observed to be less during the month. Mandi arrivals of Jeera, at all-India level decreased by 10% as compared with previous month supported by decrease in arrivals in Rajasthan as well as in Gujarat. Jeera exports during Apr-June 2022 has dropped by 42.98 percent at 47,190.98 tonnes as compared to 82,762.08 tonnes exported during Apr-June 2021. In the month of June 2022 around 21,587.63 tonnes jeera was exported as against 14,894.62 tonnes in May 2022 showing a rise of 44.94%. In the month of June 2022 around 21,587.63 tonnes of jeera was exported as against 30,989.86 tonnes in June 2021 showing a decrease of 30.34%. In the month of May 2022 around 14,894.62 tonnes of jeera was exported as against 20,693.76 tonnes in May 2021 showing a decrease of 28.03%. 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. Jeera production was seen at 725,651 tn, down 8.8% on year due to lower acreage in Rajasthan and Gujarat, the key producer, according to data from Spices Board India. According to fourth advanced estimates by Gujarat government, jeera production is seen fall by 44.5 per cent to 221500 tonnes in 2021-22 on yoy basis In Unjha, a key spot market in Gujarat, jeera edged down by -7.35 Rupees to end at 24298.6 Rupees per 100 kg.Technically market is under short covering as market has witnessed drop in open interest by -7.58% to settled at 8454 while prices up 190 rupees, now Jeera is getting support at 24625 and below same could see a test of 24355 levels, and resistance is now likely to be seen at 25090, a move above could see prices testing 25285.

Trading Ideas:
* Jeera trading range for the day is 24355-25285.
* Jeera prices rose as supply was observed to be less as farmers and stockists were holding stocks
* Mandi arrivals of Jeera, at all-India level decreased by 10% as compared with previous month
* All-India Jeera production is expected to fall in the Marketing year 2022-23 by around 33% to 3 lakh tonnes on y-o-y basis due to lower sowings.
* In Unjha, a key spot market in Gujarat, jeera edged down by -7.35 Rupees to end at 24298.6 Rupees per 100 kg.


Cotton

Cotton yesterday settled down by -2.98% at 39120 as India’s Cotton sowing gained by nearly 5.98% to 123.09 lakh hectares in 2022 against an area sown of 116.15 lakh hectares in 2021. In its monthly supply-demand report, the United States Department of Agriculture (USDA) cut its global production forecast by 3.1 million bales, and the U.S. output outlook by 3 million bales for the 2022-23 crop year. Hot and dry weather conditions in key growing areas in the United States have threatened the condition of the natural fiber crop and raised supply concerns. The USDA's lower global output estimates also reflected a reduction of about 100,000 bales "as extreme heat in Uzbekistan reduced yield prospects there." However, the agency said it expects the lower U.S. production projections to result in a 2 million bale reduction in exports compared with July, and a 200,000 bale dip in mill use. India’s Cotton sowing gained by nearly 5.34% to 117.65 lakh hectares in 2022 against an area sown of 111.69 lakh hectares in 2021. In Gujarat Cotton sowing grows by nearly 13% with 2,528,354.00 hectares against sown area of 2021 which was 2,240,765.00 hectares as of now. In spot market, Cotton dropped by -460 Rupees to end at 47400 Rupees.Technically market is under long liquidation as market has witnessed drop in open interest by -0.66% to settled at 747 while prices down -1200 rupees, now Cotton is getting support at 38450 and below same could see a test of 37790 levels, and resistance is now likely to be seen at 40030, a move above could see prices testing 40950.
 

Trading Ideas:
* Cotton trading range for the day is 37790-40950.
* Cotton dropped as India’s Cotton sowing gained by nearly 5.98% to 123.09 lakh hectares in 2022.
* However, cotton crops in India, remain under threat due to adverse weather conditions and pest attacks in major growing regions.
* USDA cut its global production forecast by 3.1 million bales, and the U.S. output outlook by 3 million bales for the 2022-23 crop year.
* In spot market, Cotton dropped  by -460 Rupees to end at 47400 Rupees.

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