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Gold 

Gold yesterday settled down by -0.11% at 50143 weighed down by rallying Treasury yields on expectations that the US Federal Reserve will continue raising interest rates aggressively until inflation abates. Federal Reserve Bank of Minneapolis President Neel Kashkari said that U.S. job market demand remained strong and underlying inflation pressures probably had not peaked yet. The Fed is widely expected to hike interest rates by 75 basis points at its policy meeting next month after U.S consumer prices increased more than expected in September. Swiss gold exports to top markets China and India increased in September, while shipments to Turkey rose to the highest since April 2013, Swiss customs data showed. A decline in gold prices from more than $2,000 an ounce in March to around $1,650 has boosted demand for gold bars, coins and jewellery in Asia, where buyers typically take advantage of low prices. Physical gold buying improved in India as prices cooled ahead of the Dhanteras and Diwali festivals later this month, while Chinese premiums stayed elevated amid robust demand. In India, dealers were charging $1.5 an ounce premium over official domestic prices versus $6 discounts last week. Technically market is under long liquidation as the market has witnessed a drop in open interest by -3% to settle at 13171 while prices are down -56 rupees, now Gold is getting support at 50002 and below same could see a test of 49861 levels, and resistance is now likely to be seen at 50347, a move above could see prices testing 50551.

Trading Ideas:

Gold trading range for the day is 49861-5055

Gold dropped amid higher Treasury yields and prospects of more sharp rate hikes by Federal Reserve

The number of Americans filing new claims for unemployment benefits fell by 12,000 to 214,000

Fed’s Kashkari said that U.S. job market demand remained strong and underlying inflation pressures probably had not peaked yet

Silver 

Silver yesterday settled up by 1.14% at 56653 as the dollar index weakened below the 113 mark as investors paused to reassess the potential economic impact of the Federal Reserve's tightening campaign to tame stubbornly high inflation. A Fed report released pointed to a weakening outlook for economic conditions in the US due to high inflation and rising interest rates. Still, markets are currently priced for another 75 basis point rate hike next month, with a chorus of hawkish statements from US policymakers hinting at an even higher peak for rates supporting such a view. Minneapolis Fed President Kashkari was the latest policymaker to emphasize that the Federal Reserve needs to raise borrowing costs quickly, should underlying inflation risks continue on the upside. The central bank is widely expected to continue its tightening path in its upcoming November meeting, with Fed funds futures pricing a fourth consecutive 75bps hike. A report released by the Commerce Department showed new residential construction in the U.S. tumbled by more than expected in the month of September. The report said housing starts plunged by 8.1% to an annual rate of 1.439 million in September after soaring by 13.7% to a revised rate of 1.566 million in August. Technically market is under short covering as the market has witnessed a drop in open interest by -7.68% to settle at 20229 while prices are up 639 rupees, now Silver is getting support at 55758 and below same could see a test of 54863 levels, and resistance is now likely to be seen at 57394, a move above could see prices testing 58135.

Trading Ideas:

Silver trading range for the day is 54863-58135.

Silver gained as dollar weakened below the 113 mark as investors paused to reassess the potential economic impact of the Federal Reserve's tightening.

A Fed report released pointed to a weakening outlook for economic conditions in the US due to high inflation and rising interest rates.

Fed’s Kashkari was the latest policymaker to emphasize that the Federal Reserve needs to raise borrowing costs quickly

Crude oil

Crude oil yesterday settled up by 0.62% at 7091 as prospects of tight global supplies continued to lend optimism to bulls. OPEC and its allies, including Russia, agreed to cut production by 2 million barrels per day in November, the most significant curb since the start of the pandemic, while speculation grows that the oil cartel will further intervene in markets to shore up prices. A looming European Union ban on Russian crude also exacerbated concerns about tight supplies. On top of that, official data showed that US crude inventories unexpectedly fell by 1.7 million barrels last week. Keeping a lid on prices in the short term was the US decision to sell 15 million barrels of oil from the Strategic Petroleum Reserve. Still, SPR levels in the US also dropped by 3.6 million barrels to just over 405 million, the lowest since May 1984. Oil output in the Permian in Texas and New Mexico, the biggest U.S. shale oil basin, is due to rise by about 50,000 barrels per day (bpd) to a record 5.453 million bpd in November, the U.S. Energy Information Administration (EIA) said in its productivity report. U.S. crude oil output is due to rise by about 104,000 bpd to 9.105 million bpd in November, its highest since March 2020, the EIA projected. Technically market is under short covering as the market has witnessed a drop in open interest by -6.28% to settle at 3659 while prices are up 44 rupees, now Crude oil is getting support at 6975 and below same could see a test of 6860 levels, and resistance is now likely to be seen at 7221, a move above could see prices testing 7352

Trading Ideas:

Crude oil trading range for the day is 6860-7352

Crude oil gained as prospects of tight global supplies continued to lend optimism to bull

A looming European Union ban on Russian crude also exacerbated concerns about tight supplies

Official data showed that US crude inventories unexpectedly fell by 1.7 million barrels last week

Nat.Gas

Nat.Gas yesterday settled down by -2.51% at 445.8 as record output and reduced liquefied natural gas (LNG) exports allowed utilities to keep injecting more gas into storage than usual for weeks. Data provider Refinitiv said average gas output in the U.S. Lower 48 states rose to 99.6 bcfd so far in October, up from a monthly record of 99.4 bcfd in September. With milder weather coming, Refinitiv projected average U.S. gas demand, including exports, would fall from 100.7 bcfd this week to 96.7 bcfd next week. The forecast for next week was higher than Refinitiv's outlook on Tuesday. The average amount of gas flowing to U.S. LNG export plants has fallen to 11.1 bcfd so far in October from 11.5 bcfd in September and well below the 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. U.S. LNG exports, however, could start to rise this week if Cove Point returns to service as some traders expect. U.S. natural gas prices at the Henry Hub benchmark in Louisiana will rise to $6.76 per million British thermal units (mmBtu) in 2022, their highest since 2008, before falling to $5.64 in 2023, according to analyst forecasts. Technically market is under long liquidation as the market has witnessed a drop in open interest by -17.3% to settle at 9573 while prices are down -11.5 rupees, now Natural gas is getting support at 433.8 and below same could see a test of 421.8 levels, and resistance is now likely to be seen at 460.6, a move above could see prices testing 475.4

Trading Ideas:

Natural gas trading range for the day is 421.8-475.4

Natural gas fell as record output and reduced LNG exports allowed utilities to keep injecting more gas into storage than usual for weeks.

Data provider Refinitiv said average gas output in the U.S. Lower 48 states rose to 99.6 bcfd so far in October

Average US gas demand, including exports, is expected to fall to 94.9 bcfd next week from 100.3 bcfd this week

Copper 

Copper yesterday settled up by 1.32% at 646.85 as support came after a Peruvian community began a blockade of a key copper transport corridor, marking another episode of protests that have disrupted mining operations in the region. The blockade was organized in the district of Colquemarca, in Peru's Andean Cusco region, the Mining Conflicts Observatory said, adding that protesters were demanding a "budget for development projects." The Observatory also reported a separate blockade further down the road in Cusco's Espinar province. Chinese refined copper buyers may increase their purchase of Russian metal amid expected rising premiums for copper sales to China in 2023 seen between $150 and $210 a tonne over LME three-month price, and up from $105 in 2022 and $88 a tonne in 2021. The global copper market is expected to see a deficit of about 325,000 tonnes this year and a surplus of 155,000 tonnes in 2023, the International Copper Study Group (ICSG) said. "Continued COVID-19 related restrictions and workforce absenteeism, operational and geotechnical issues, strikes, water restrictions in Chile, lower than expected head grades and community actions in Peru have constrained mine output at a number of operations this year," it said in a release. World apparent refined copper usage is expected to increase by about 2.2% in 2022 and 1.4% in 2023, the ICSG said. Technically market is under short covering as the market has witnessed a drop in open interest by -31.28% to settle at 3021 while prices are up 8.45 rupees, now Copper is getting support at 637.6 and below same could see a test of 628.4 levels, and resistance is now likely to be seen at 653.6, a move above could see prices testing 660.4

Trading Ideas:

Copper trading range for the day is 628.4-660.4

Copper prices gained as support came after a Peru protests disrupt key copper transport road

Chinese refined copper buyers may increase their purchase of Russian metal amid expected rising premiums for copper sales to China in 2023

Global copper market to see 155,000 tonne surplus in 2023, says ICSG

Zinc 

Zinc yesterday settled up by 1.34% at 273.15 amid growing concerns about tight supplies after the London Metal Exchange signaled that it would restrict supplies from Russia. Markets were already tight as European smelters have been cutting back production amid soaring power prices. According to Europe’s metals trade association Eurometaux, half of Europe’s aluminum and zinc production capacity has already been forced offline as the continent’s energy crisis threatens to hobble heavy industries. South American zinc and copper producer Nexa Resources SA expects tight supplies of zinc metals globally due to smelter closures in Europe as energy prices skyrocket, a situation that is boosting overall price premiums. Nexa's Chief Executive Ignacio Rosado, ahead of a meeting with investors at the New York Stock Exchange (NYSE), that the European situation is opening opportunities to expand zinc sales in the continent at higher prices. China kept its benchmark lending rates unchanged for a second straight month on Thursday, in line with expectations, as authorities held off unleashing more monetary stimulus to avoid stark policy divergence with other major economies. The one-year loan prime rate (LPR) was kept at 3.65%, while the five-year LPR was unchanged at 4.30%. The steady LPR fixings came after the People's Bank of China (PBOC) left the interest rate of its medium-term policy loans unchanged this week. Technically market is under short covering as the market has witnessed a drop in open interest by -19.18% to settle at 1441 while prices are up 3.6 rupees, now Zinc is getting support at 269.9 and below same could see a test of 266.5 levels, and resistance is now likely to be seen at 275.4, a move above could see prices testing 277.5.

Trading Ideas:

Zinc trading range for the day is 266.5-277.5.

Zinc prices gained amid growing concerns about tight supplies after the London Metal Exchange signaled that it would restrict supplies from Russia

Zinc producer Nexa expects high prices as Europe smelters shut

Markets were already tight as European smelters have been cutting back production amid soaring power prices.
 

Aluminium 

Aluminium yesterday settled up by 0.79% at 197.75 as China’s aluminium ingot social inventory stood at 636,000 mt, a weekly drop of 19,000 mt, down 321,000 YoY. Global primary aluminium output in September rose 4.28% year on year to 5.702 million tonnes, data from the International Aluminium Institute (IAI) showed. Estimated Chinese production was 3.398 million tonnes in September, the IAI said. China kept its benchmark lending rates unchanged for a second straight month on Thursday, in line with expectations, as authorities held off unleashing more monetary stimulus to avoid stark policy divergence with other major economies. The one-year loan prime rate (LPR) was kept at 3.65%, while the five-year LPR was unchanged at 4.30%. The steady LPR fixings came after the People's Bank of China (PBOC) left the interest rate of its medium-term policy loans unchanged this week. The borrowing cost of the medium-term lending facility (MLF) serves as a guide to the LPR, and markets typically see the medium-term rate guiding changes to the lending benchmark. The fundamentals changed little today, featuring easing supply pressure in China and high manufacturing cost overseas on high energy prices. The consumption side was still lacklustre on pandemic outbreak. Technically market is under short covering as the market has witnessed a drop in open interest by -14.92% to settle at 2390 while prices are up 1.55 rupees, now Aluminium is getting support at 196.2 and below same could see a test of 194.6 levels, and resistance is now likely to be seen at 199.6, a move above could see prices testing 201.4

Trading Ideas:

Aluminium trading range for the day is 194.6-201.4.

Aluminum gains as China’s aluminium ingot social inventory stood at 636,000 mt, a weekly drop of 19,000 mt

Global aluminium output rises 4.28% y/y in September – IAI

China leaves lending benchmarks unchanged for second month in Oct

Mentha oil
 

Mentha oil yesterday settled down by -0.27% at 967.3 as mentha exports during Apr-Aug 2022 has dropped by 14.27 percent at 886.53 tonnes as compared to 1034.14 tonnes exported during Apr-Aug 2021. Exports in the month of August 2022 were around 238.04 tonnes as against 155.04 tonnes in July 2022 showing a rise of 53.53%. In the month of August 2022 around 238.04 tonnes of Mentha was exported as against 227.27 tonnes in August 2021 showing a rose of 4.74%. Synthetic Mentha supply remains uninterrupted. Support also seen 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, 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 Spot market, support seen after IMD issues Yellow Alert in key sowing area ; light-moderate rain to continue till Sept 4 impacting arrival in the mandi. In Sambhal spot market, Mentha oil gained by 1.9 Rupees to end at 1136.5 Rupees per 360 kgs.Technically market is under long liquidation as the market has witnessed a drop in open interest by -35.57% to settle at 605 while prices are down -2.6 rupees, now Mentha oil is getting support at 964.7 and below same could see a test of 962.1 levels, and resistance is now likely to be seen at 971.2, a move above could see prices testing 975.1

Trading Ideas:

Mentha oil trading range for the day is 962.1-975.1

In Sambhal spot market, Mentha oil gained  by 1.9 Rupees to end at 1136.5 Rupees per 360 kgs.

Mentha oil dropped as mentha exports during Apr-Aug 2022 has dropped by 14.27 percent at 886.53 tonnes

August exports were around 238.04 tonnes showing a rise of 53.53% compared to July 2022.

However, Synthetic Mentha supply remains uninterrupted.
 

Turmeric 

Turmeric yesterday settled up by 0.13% at 7508 as support seen after Agriculture Minister Narendra Singh Tomar said unseasonal rains in some parts of the country have affected the crops. Arrivals has been dropped by 26% Y-o-Y due to lower production as about 11248 tonnes of turmeric arrived at APMC mandies across India in Sep’22 compared to 15758 tonnes of previous year for corresponding month. As per Andhra Pradesh agricultural department, as on 06th October 2022 Turmeric sowing activity completed around 16,921 hectares as compared to last year same period 19,376 hectares, down by 12.67% till date. Turmeric exports during Apr-August 2022 has rose by 15.35 percent at 74,393.62 tonnes as compared to 64,493.34 tonnes exported during Apr- August 2021. In the month of August 2022 around 12,147.89 tonnes turmeric was exported as against 12,810.36 tonnes in July 2022 showing a drop of 5.17%. In the month of August 2022 around 12,147.89 tonnes of turmeric was exported as against 11,617.90 tonnes in August 2021 showing a rise of 4.56%. 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 7265.15 Rupees gained 16.5 Rupees.Technically market is under short covering as the market has witnessed a drop in open interest by -5.34% to settle at 10015 while prices are up 10 rupees, now Turmeric is getting support at 7454 and below same could see a test of 7398 levels, and resistance is now likely to be seen at 7578, a move above could see prices testing 7646

Trading Ideas:

Turmeric trading range for the day is 7398-7646.

Turmeric rose as support seen after Agriculture Minister said unseasonal rains in some parts of the country have affected the crops.

As per Andhra Pradesh agricultural department, turmeric sowing activity completed around 16,921 hectares, down by 12.67% till date from last year.

Marathwada region has been serving as a round-the-year supply centre for Turmeric since past couple of years.

In Nizamabad, a major spot market in AP, the price ended at 7265.15 Rupees gained 16.5 Rupees.

Jeera 

Jeera yesterday settled down by -0.29% at 24035 on profit booking after reports sowing started in some parts of Rajasthan as moisture conditions is less and completed around 2% to 3% in the key growing regions. Current year sowing area likely to increase in Rajasthan and Gujarat growing regions. Current year Jeera sowing is likely to start from October last week or November first week in Gujarat growing regions. Due to moisture conditions as a result of higher rainfall sowing may be delayed by 10 to 15 days current year. Jeera exports during Apr-August 2022 has dropped by 26.44 percent at 91,505.49 tonnes as compared to 1,24,390.31 tonnes exported during Apr- August 2021. In the month of August 2022 around 24,448.33 tonnes jeera was exported as against 19,866.18 tonnes in July 2022 showing a rise of 18.74%. In the month of August 2022 around 24,448.33 tonnes of jeera was exported as against 17,460.60 tonnes in August 2021 showing a rise of 40.02%. 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 up by 52.75 Rupees to end at 23940.15 Rupees per 100 kg.Technically market is under fresh selling as the market has witnessed a gain in open interest by 0.51% to settle at 6450 while prices are down -70 rupees, now Jeera is getting support at 23895 and below same could see a test of 23760 levels, and resistance is now likely to be seen at 24235, a move above could see prices testing 24440.

Trading Ideas:
???????Jeera trading range for the day is 23760-24440..

Jeera dropped on profit booking after reports sowing started in some parts of Rajasthan

Current year sowing area likely to increase in Rajasthan and Gujarat growing regions.

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 up by 52.75 Rupees to end at 23940.15 Rupees per 100 kg.

Cotton ???????

Cotton yesterday settled down by -0.27% at 33040 as India is likely to produce 34.4 million bales of cotton in the 2022/23 season that started on Oct. 1, up 12% from a year ago after farmers expanded the crop area. India’s cotton output for the season ended September 30, 2022, fell to 307.5 lakh bales (against 360.13 lakh bales estimated at the beginning of the season in October last year. This is the lowest since 2007-08, when the production was 307 lakh bales. WASDE report said world trade is projected to be nearly 1 million bales lower from September, with declines in imports by China, Pakistan, Mexico, Turkey and Vietnam. The agency lowered its U.S. exports forecast by 100,000 bales to 12.5 million bales, while also cutting export estimates for Australia, Brazil, India, Benin, Cote d’Ivoire, Greece and Mexico. "In the 2022/23 world balance sheet this month, consumption is 3.0 million bales lower and ending stocks are 3.1 million bales higher," the USDA said. USDA said its estimates for 2022/23 U.S. cotton crop ending stocks are 100,000 bales higher from a year earlier, with production nearly unchanged at 13.8 million bales. In Gujarat, new cotton arrival increased, and daily arrival reached 6,000 bales of 170 kg. Ginning mills have started buying seed cotton with the advent of the auspicious festival of Navratri. However, spinning mills are cautious as they expect a downward trend in cotton prices during peak arrival. In spot market, Cotton dropped by -510 Rupees to end at 33190 Rupees.Technically market is under long liquidation as the market has witnessed a drop in open interest by -4.11% to settle at 467 while prices are down -90 rupees, now Cotton is getting support at 32640 and below same could see a test of 32250 levels, and resistance is now likely to be seen at 33410, a move above could see prices testing 33790.

Trading Ideas:

Cotton trading range for the day is 32250-33790.

Cotton dropped as India’s cotton output seen rising 12% on bigger crop area

However downside seen limited as crops remain threatened due to adverse weather conditions and pest attacks in major growing regions

USDA projected higher year-end stocks and a decline in exports amid a slowdown in consumption

In spot market, Cotton dropped  by -510 Rupees to end at 33190 Rupees.

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