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Gold
Gold yesterday settled down by -0.21% at 50536 with the Federal Reserve likely to raise benchmark interest rate by an expected 75 basis points in its meet later this week. The Fed is expected to opt for another 75-basis-point hike rather than a larger move to quell stubbornly-high inflation as the likelihood of a recession over the next year rises to 40%. China's net gold imports via Hong Kong in June jumped by about 390% from the previous month, Hong Kong Census and Statistics Department data showed. Net imports stood at 40.563 tonnes in June, compared with 8.281 tonnes in May, the data showed. Total gold imports via Hong Kong jumped nearly 208% to 43.587 tonnes. The US central bank is widely expected to deliver another 75 basis point rate hike this week, and markets will focus on Fed Chair Jerome Powell's comments for further clues on the monetary policy path. Last week, data showed US business activity contracted in July for the first time in nearly two years, while advance estimates for second quarter US GDP due on Thursday will give investors more insight into the state of the world’s largest economy. European data also pointed to slowing growth as the region grapples with energy security issues. Technically market is under long liquidation as market has witnessed drop in open interest by -19.87% to settled at 3808 while prices down -108 rupees, now Gold is getting support at 50391 and below same could see a test of 50245 levels, and resistance is now likely to be seen at 50738, a move above could see prices testing 50939.
Trading Ideas:
* Gold trading range for the day is 50245-50939.
* Gold prices dropped with Fed likely to raise benchmark interest rate by an expected 75 basis points.
* The Fed is expected to opt for another 75-basis-point hike rather than a larger move to quell stubbornly-high inflation
* European data pointed to slowing growth as the region grapples with energy security issues.

Silver
Silver yesterday settled down by -1.31% at 54407 as lingering worries about demand in China and aggressive tightening by major central banks to rein on sky-high inflation continue to spook investors away from the non-yielding metal. The Federal Reserve is highly expected to deliver a 75bps rate hike this week, following a similar move in June and pushing borrowing costs to the highest level since 2019. Also, the ECB raised policy rates by a more than expected 50bps increase last week and the BoE is likely to follow the same path next week. Meanwhile, safe-haven flows from global growth uncertain have been pushed toward the dollar. Bond yields were little changed after sliding on Friday as weak data added to worries about the global economy. Investors are pinning hopes that the U.S. Federal Reserve will likely slow the pace of interest-rate increases after front-loading policy with a second straight 75-bps rate hike on Wednesday. U.S. Treasury Secretary Janet Yellen said that a recession is not inevitable. Ahead of a slew of U.S. data due this week, Yellen said that there was the risk of a recession, but a downturn was not inevitable. Technically market is under fresh selling as market has witnessed gain in open interest by 7.53% to settled at 24481 while prices down -724 rupees, now Silver is getting support at 53984 and below same could see a test of 53562 levels, and resistance is now likely to be seen at 55004, a move above could see prices testing 55602.
Trading Ideas:
* Silver trading range for the day is 53562-55602.
* Silver remained under pressure as lingering worries about demand in China and aggressive tightening by major central banks to rein on sky-high inflation
* U.S. Treasury Secretary Janet Yellen said that a recession is not inevitable.
* Fed expected to hike interest rate by 75 bps on Wednesday

Crude oil
Crude oil yesterday settled up by 0.69% at 7713 as concerns about outlook for energy demand eased slightly on news new Covid-19 cases in China dropped to the lowest level in more than a week. Oil have been volatile in recent weeks as traders try to reconcile the possibilities of further interest rate hikes that could limit economic activity, and thus cut fuel demand growth, against tight supply from the disruptions in the trading of Russian barrels because of the Western sanctions amid the Ukraine conflict. On the supply side, Libya's National Oil Corporation (NOC) aims to bring back production to 1.2 million barrels per day (bpd) in two weeks, NOC said in a statement. Current oil production is at 860,000 bpd, compared with 560,000 bpd before resuming production, NOC added. The European Union said last week that it would allow Russian state-owned companies to ship oil to third countries under an adjustment of sanctions agreed by member states last week aimed at limiting the risks to global energy security. However, Russian Central Bank Governor Elvira Nabiullina said that Russia will not supply oil to countries that decide to impose a price cap on its oil. Technically market is under fresh buying as market has witnessed gain in open interest by 7.43% to settled at 3282 while prices up 53 rupees, now Crude oil is getting support at 7519 and below same could see a test of 7325 levels, and resistance is now likely to be seen at 7826, a move above could see prices testing 7939.
Trading Ideas:
* Crude oil trading range for the day is 7325-7939.
* Crude oil gains as concerns about outlook for energy demand eased slightly
* Libya to increase oil output to 1.2 mln bpd in 2 weeks - NOC
* EU tweaks sanctions to unblock Russian oil deals with third countries

Natural gas
Nat.Gas yesterday settled up by 4.88% at 691.9 on prospects of an increasing need for cooling as the weather remains hotter than usual in the United States. Soaring international demand is also adding to the bullish outlook. Russia's war on Ukraine has caused a global energy crunch, with demand for US LNG set to remain elevated partly due to Europe's calls for US exports to help cut reliance on Russian gas. On top of that, the latest EIA's weekly inventory report showed utilities injected just 34 billion cubic feet (bcf) of natural gas into underground storage last week, markedly below median market estimates of a 47 bcf build. The number of rigs drilling for natural gas in the United States rose by 2 this week to 155, data from oil services firm Baker Hughes showed. Horizontal rigs – the type most often used to extract oil or gas from shale – rose by 1 to 687. Data provider Refinitiv said average gas output in the U.S. Lower 48 states has risen to 96.1 bcfd so far in July from 95.3 bcfd in June. Refinitiv projected average U.S. gas demand including exports would slide from 101.1 bcfd this week to 100.6 bcfd next week and 99.9 bcfd in two weeks as extreme heat starts to ease in some parts of the country. Technically market is under short covering as market has witnessed drop in open interest by -72.63% to settled at 1050 while prices up 32.2 rupees, now Natural gas is getting support at 673.4 and below same could see a test of 655 levels, and resistance is now likely to be seen at 702.1, a move above could see prices testing 712.4.
Trading Ideas:
* Natural gas trading range for the day is 655-712.4.
* Natural gas prices rose on prospects of an increasing need for cooling as the weather remains hotter than usual in the United States.
* The latest EIA's weekly inventory report showed utilities injected just 34 billion cubic feet (bcf) of natural gas into underground storage last week.
* The number of rigs drilling for natural gas in the United States rose by 2 this week to 155

Copper
Copper yesterday settled up by 0.21% at 633.2 amid weaker dollar, but prices remained under pressure as slowing economic growth clouds the demand outlook. To rein in inflation, central banks worldwide have begun rapid interest rises that are likely to stifle economic growth. Demand has been weak in China, the biggest consumer, due to COVID-19 lockdowns, though the government has promised stimulus to revive growth. Speculative investors are becoming less bearish, cutting their net short position in COMEX copper to around 14,500 contracts from around 26,500 in early July. Germany is on the cusp of recession, and the economy is losing steam in the United States, where the Federal Reserve is expected to raise interest rates sharply again this week. The global copper market moved to a surplus of 5,000 tonnes in May, from a deficit of 23,000 tonnes a month earlier, data from the International Copper Study Group (ICSG) showed. Previously, the ICSG had reported a surplus of 3,000 tonnes in April. During the first five months of 2022, ICSG data showed a surplus of 43,000 tonnes versus a deficit of 23,000 tonnes in the same period of 2021. But copper stocks in exchange warehouses are low, with only 50,350 tonnes in the ShFE, near last year's 12-1/2 year low of 27,171 tonnes. Technically market is under fresh buying as market has witnessed gain in open interest by 7.74% to settled at 5732 while prices up 1.3 rupees, now Copper is getting support at 628.5 and below same could see a test of 623.7 levels, and resistance is now likely to be seen at 638.8, a move above could see prices testing 644.3.
Trading Ideas:
* Copper trading range for the day is 623.7-644.3.
* Copper prices remained supported amid weaker dollar, but prices remained under pressure as slowing economic growth clouds the demand outlook.
* Global copper market shifts to a 5,000 tonne surplus in May – ICSG
* Speculative investors are becoming less bearish, cutting their net short position in COMEX copper to around 14,500 contracts from around 26,500 in early July.

Zinc
Zinc yesterday settled down by -0.29% at 272.35 as market sentiment was weak amid easing ore supply tightness that resulted in weaker cost supply. ECB President Lagarde said in an interview with German media that the ECB will continue to raise interest rates until inflation falls back to the 2% target level. US Treasury Secretary Yellen said that US economic growth is slowing and she acknowledged the risk of recession but also said that an economic downturn is not inevitable. Under sanctions adjustments agreed by EU member states, Rosneft and Gazprom will be able to ship oil to third countries, a move aimed at mitigating global energy security risks. The preliminary US composite PMI plunged to 47.5 in July from a final reading of 52.3 in June, much weaker than expected. China's State Council: The economy is at a critical point of stabilisation and recovery, with priority given to ensuring that the goal of stable employment and prices. Zinc ingot social inventory across the seven markets in China dropped 10,200 mt from last Monday, but it was merely the result of less arrivals instead of robust consumption. The global zinc market flipped to a deficit of 3,900 tonnes in May from a revised surplus of 31,000 tonnes a month earlier, data from the International Lead and Zinc Study Group (ILZSG) showed. Technically market is under fresh selling as market has witnessed gain in open interest by 6.5% to settled at 1459 while prices down -0.8 rupees, now Zinc is getting support at 270.9 and below same could see a test of 269.2 levels, and resistance is now likely to be seen at 273.8, a move above could see prices testing 275.
Trading Ideas:
* Zinc trading range for the day is 269.2-275.
* Zinc prices dropped as market sentiment was weak amid easing ore supply tightness that resulted in weaker cost supply.
* The economy is at a critical point of stabilisation and recovery, with priority given to ensuring that the goal of stable employment and prices.
* Global zinc market moved to deficit of 3,900 T in May, says ILZSG

Aluminium
Aluminium yesterday settled down by -1.81% at 209.3 as fears of a demand-sapping global recession and higher production levels continued to hang over the market. Base metal prices came under significant pressure as increasingly hawkish central banks and soaring energy prices dented industrial activity. On top of that, top consumer China continued to increase production as smelters recovered from last year’s aggressive energy efficiency targets and recent coronavirus-induced halts. Some aluminium smelters in Sichuan have reduced production, but oversupply pressure remains strong. In terms of demand, downstream consumption remained poor. The operating rates of major aluminium processing companies were basically stable last week. Given the poor fundamentals, it is expected that aluminium prices will remain under pressure. Aluminium stocks at three major Japanese ports rose 2.9% to 369,800 tonnes at the end of June from 359,400 tonnes at the end of May, Marubeni Corp said. Global primary aluminium output in June rose 1.95% year on year to 5.65 million tonnes, data from the International Aluminium Institute (IAI) showed. Estimated Chinese production was 3.33 million tonnes in June, the IAI data showed. Technically market is under fresh selling as market has witnessed gain in open interest by 44.55% to settled at 3141 while prices down -3.85 rupees, now Aluminium is getting support at 207.8 and below same could see a test of 206.2 levels, and resistance is now likely to be seen at 211.8, a move above could see prices testing 214.2.
Trading Ideas:
* Aluminium trading range for the day is 206.2-214.2.
* Aluminium dropped as fears of a demand-sapping global recession and higher production levels continued to hang over the market.
* Prices came under significant pressure as increasingly hawkish central banks and soaring energy prices dented industrial activity.
* China continued to increase production as smelters recovered from last year’s aggressive energy efficiency targets and recent coronavirus-induced halts.

Mentha oil
Mentha oil yesterday settled down by -0.46% at 1010.6 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 harvest is expected to be almost the same as last year's in Barabanki area but harvesting this year is expected to be delayed. Crop growth is poor this year compared with last year despite use of fertiliser. The plant is about 25% less than the total crop, water is being felt after every three days. 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. Germany's BASF said it would have to stop production if natural gas supplies fell to less than half its needs, as the world's largest chemicals group warned of the damage to its operations from Europe's power crunch. In Sambhal spot market, Mentha oil dropped by -1.7 Rupees to end at 1112.7 Rupees per 360 kgs.Technically market is under fresh selling as market has witnessed gain in open interest by 16.04% to settled at 1476 while prices down -4.7 rupees, now Mentha oil is getting support at 1004.4 and below same could see a test of 998.2 levels, and resistance is now likely to be seen at 1017.4, a move above could see prices testing 1024.2.
Trading Ideas:
* Mentha oil trading range for the day is 998.2-1024.2.
* In Sambhal spot market, Mentha oil dropped  by -1.7 Rupees to end at 1112.7 Rupees per 360 kgs.
* Mentha oil dropped as Synthetic Mentha supply remains uninterrupted.
* In the month of May 2022 around 209.90 tonnes Mentha was exported as against 170.22 in April 2022 showing a rise of 23.31%.
* In the month of May 2022 around 209.90 tonnes of Mentha was exported as against 179.76 in May 2021 showing a rise of 16.77%.

Turmeric
Turmeric yesterday settled down by -0.21% at 7690 on profit booking after prices remained supported amid expectations of decline in sown area in the ongoing kharif sowing season. Mandi arrivals of Turmeric, at all-India level, 0.22 lakh tonnes, marking a decline of 38% on m-o-m basis and 48% on y-o-y basis. The major Turmeric producing states such as Telangana, Maharashtra witnessed fall in mandi arrivals during the month of July. Turmeric sowing for marketing year 2023 has started across major production states. In the beginning of June, with the delay in monsoon progress over key Turmeric growing states like Andhra Pradesh, Maharashtra and Tamil Nadu, Turmeric sowings remained sluggish. Stockists have remained inactive due to availability of stock in Marathwada region. As per market feedback, in the ongoing season, no major quality concerns were observed in the crop arrived in the Marathwada region. Turmeric exports during Apr-May 2022 has rose by 14.94 percent at 30,899.73 as compared to 26,881.41 exported during Apr-May 2021. In the month of May 2022 around 17,137.15 tonnes turmeric was exported as against 13762.59 in April 2022 showing a rise of 24.51%. In the month of May 2022 around 17,137.15 tonnes of turmeric was exported as against 13,598.88 in May 2021 showing an increase of 26.02%. In Nizamabad, a major spot market in AP, the price ended at 8062.5 Rupees gained 44.5 Rupees.Technically market is under long liquidation as market has witnessed drop in open interest by -2.74% to settled at 15235 while prices down -16 rupees, now Turmeric is getting support at 7624 and below same could see a test of 7560 levels, and resistance is now likely to be seen at 7728, a move above could see prices testing 7768.
Trading Ideas:
* Turmeric trading range for the day is 7560-7768.
* Turmeric dropped on profit booking after prices remained supported amid expectations of decline in sown area in the ongoing kharif sowing season.
* In the ongoing season, no major quality concerns were observed in the crop arrived in the Marathwada region.
* Turmeric exports during Apr-May 2022 has rose by 14.94 percent at 30,899.73 as compared to 26,881.41 exported during Apr-May 2021.
* In Nizamabad, a major spot market in AP, the price ended at 8062.5 Rupees gained 44.5 Rupees.

Jeera
Jeera yesterday settled down by -1.63% at 23500 on profit booking after prices remained supported 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. However, mandi arrivals were also lower by 39% compared to the corresponding period of the previous year. As per market feedback, export demand has decreased as compared to corresponding period of the previous year. The reason behind decline in export demand was lower exports to China, as the country had imposed lockdown amid resurgence of Covid. In last 3 years Jeera export was observed to be 7.30 Lakh Tonnes out of which 2.01 Lakh Tonnes was exported to China i.e 28% of total jeera exported. As per preliminary estimates, all-India Jeera production is expected to fall in the Marketing year 2022-23 (April-March) by around 33% to 3 lakh tonnes on y-o-y basis due to lower sowings. As per Fourth advance estimates released by Govt of Gujarat Jeera production is likely to fall by 45% to 2.22 lakh tonnes over the previous year. Area covered under cumin seed in Gujarat and Rajasthan state (considered together) has decreased by 28% over last year. In Unjha, a key spot market in Gujarat, jeera edged down by -320.5 Rupees to end at 23328.9 Rupees per 100 kg.Technically market is under long liquidation as market has witnessed drop in open interest by -3.64% to settled at 11127 while prices down -390 rupees, now Jeera is getting support at 23300 and below same could see a test of 23095 levels, and resistance is now likely to be seen at 23830, a move above could see prices testing 24155.
Trading Ideas:
* Jeera trading range for the day is 23095-24155.
* Jeera dropped on profit booking after prices remained supported 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 -320.5 Rupees to end at 23328.9 Rupees per 100 kg.

Cotton 
Cotton yesterday settled up by 2% at 43320 as crop has been damaged as excessive rains continue to hit parts of the Maharashtra State. According to government sources, if rains continue to hit the State for the next few days more crop is likely to get damaged. However, upside seen limited after CAI reports at least 10% higher sowing is expected compared to previous kharif season’s 12 million hectares. Looking at the current trend, cotton sowing in Maharashtra is expected to cross 4.2 million hectares. In Gujarat, it would be around 2.7 million hectares. The cotton acreage in north will be around 1.5 million hectares and the same for southern states is likely to remain at around 3.5-4.0 million hectare. Reports of severe damage to crop due to heavy rains in Gujarat in the last 4 days, most of the sowings have failed. In Punjab, area under cotton cultivation dips to lowest since 2010, also Cotton crop in Punjab is on radar for second straight year as attack of whitefly, pink bollworm seen, as per the report. China has decided to buy three to five lac tonnes of cotton from international markets for its state reserves. The U.S. 2022/23 cotton projections show lower production, exports, and ending stocks compared with last month. In spot market, Cotton gained by 170 Rupees to end at 41680 Rupees.Technically market is under fresh buying as market has witnessed gain in open interest by 47.06% to settled at 800 while prices up 850 rupees, now Cotton is getting support at 42080 and below same could see a test of 40830 levels, and resistance is now likely to be seen at 44290, a move above could see prices testing 45250.
Trading Ideas:
* Cotton trading range for the day is 40830-45250.
* Cotton gains as crop has been damaged as excessive rains continue to hit parts of the Maharashtra State.
* However, upside seen limited after CAI reports at least 10% higher sowing is expected compared to previous 12 million hectares.
* The U.S. 2022/23 cotton projections show lower production, exports, and ending stocks compared with last month.
* In spot market, Cotton gained  by 170 Rupees to end at 41680 Rupees.

- www.kediaadvisory.com

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