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Gold

Gold yesterday settled up by 1.22% at 57885 as the dollar index retreated after the ADP report showed private businesses in the US added the least jobs in two years. The report reinforced the economy is slowing, in line with data showing shrinking manufacturing, easing inflation and wage-cost and a cooling housing market. Central banks added a whopping 1,136 tonnes of gold worth some $70 billion to their stockpiles in 2022, by far the most of any year since 1967, the World Gold Council (WGC) said. The data underline a shift in attitudes to gold since the 1990s and 2000s, when central banks, particularly those in Western Europe that own a lot of bullion, sold hundreds of tonnes a year. India's gold consumption in 2022 fell 3% from a year earlier, as a rally in local prices to near-record highs curtailed bullion demand during the key December quarter, the World Gold Council (WGC) said. Lower consumption in the world's second-biggest gold buyer could weigh on global prices, but help in bringing down India's trade deficit and support the ailing rupee. India's gold consumption declined to 774 tonnes last year as demand dropped 20% to 276.1 tonnes in the December quarter, the WGC said in a report. Technically market is under fresh buying as the market has witnessed a gain in open interest by 4.06% to settle at 20193 while prices are up 695 rupees, now Gold is getting support at 57336 and below same could see a test of 56787 levels, and resistance is now likely to be seen at 58192, a move above could see prices testing 58499.

Trading Ideas:

* Gold trading range for the day is 56787-58499.
* Gold gains as the dollar index retreated after the ADP report showed private businesses in the US added the least jobs in two years
* The report reinforced the economy is slowing, in line with data showing shrinking manufacturing, easing inflation and wage-cost and a cooling housing market
* Central banks bought the most gold since 1967 last year, WGC says

Silver

Silver yesterday settled up by 1.47% at 69841 after India raised total taxes on silver imports 15% and on silver dore to 14.35%, the government said in a statement, in an effort to align the duty structure of the metal with gold. "I also propose to increase the import duty on silver dore, bars and articles to align them with that on gold and platinum," Finance Minister Nirmala Sitharaman said as she presented the 2023/24 budget in parliament. The basic customs duty on silver was raised to 10% from 7.5% and Agriculture Infrastructure and Development Cess (AIDC) on the imports to 5% from 2.5%. Silver dore will carry a 10% basic import duty and 4.35% AIDC. The Federal Reserve is expected to raise its funds rate by a slower 25bps, but investors remain cautious due to possible dovish pivot pushback. Meanwhile, recession concerns tilted silver prices to go down, as traders worried about low demand for the metal as an industrial input for goods with high electricity conduction needs, which was reflected in its sharp underperformance to gold in January. Still, projections of weak supply limited the fall, as COMEX inventories remained under pressure and LBMA stockpiles plunged amid outflows to India. Technically market is under fresh buying as the market has witnessed a gain in open interest by 11.76% to settle at 20314 while prices are up 1012 rupees, now Silver is getting support at 68918 and below same could see a test of 67996 levels, and resistance is now likely to be seen at 70457, a move above could see prices testing 71074.

Trading Ideas:

* Silver trading range for the day is 67996-71074.
* Silver prices rose after India raises silver import duty to align with gold
* India raised total taxes on silver imports 15% and on silver dore to 14.35%
* Private businesses in the US created 106K jobs in January of 2023, well below an upwardly revised 253K in December and market forecasts of 178K.

 

Crude oil

Crude oil yesterday settled down by -2.82% at 6281 as data showing a greater-than-expected inventory build added to concerns about weakening demand in the US. An OPEC+ panel is likely to recommend sticking with the oil producer group's output policy when it meets, four OPEC+ delegates said, as it weighs prospects for higher Chinese demand against concerns about economic slowdown. Key ministers from OPEC+ countries – members of the Organization of the Petroleum Exporting Countries (OPEC) and others including Russia. The panel can call for a full OPEC+ meeting if warranted. OPEC+ agreed to cut its production target by 2 million barrels per day (bpd), about 2% of world demand, from November last year through until the end of 2023 to support the market. OPEC oil output fell in January, as Iraqi exports declined and Nigerian output did not recover further while Gulf members maintained strong compliance with an OPEC+ deal on production cuts to support the market. The Organization of the Petroleum Exporting Countries (OPEC) pumped 28.87 million barrels per day (bpd), the survey found, down 50,000 bpd from December. Technically market is under fresh selling as the market has witnessed a gain in open interest by 41.2% to settle at 7403 while prices are down -182 rupees, now Crude oil is getting support at 6180 and below same could see a test of 6078 levels, and resistance is now likely to be seen at 6463, a move above could see prices testing 6644.

Trading Ideas:

* Crude oil trading range for the day is 6078-6644.
* Crude oil dropped as data showing a greater-than-expected inventory build added to concerns about weakening demand in the US.
* OPEC+ seen sticking with oil output policy, delegates say
* OPEC oil output falls as Nigerian rebound falters

Natural gas

Nat.Gas yesterday settled down by -5.49% at 211.8 as forecasts for warmer weather and less heating demand next week spooked investors. At the same time, the Freeport LNG export facility in Texas was allowed to restart production. However, it is still weeks away from pulling in significant amounts of gas to produce LNG, leaving more supplies on the domestic market. Putting a floor under prices was a decline in production amid extreme cold in some states. US natural gas prices plunged roughly 35% in January, their second-biggest monthly drop ever, and are over 70% off their August peak of $10 as milder weather has delayed the wintering heating season. Output was on track to drop about 3.4 billion cubic feet per day (bcfd) over the past week or so to a preliminary one-month low of 95.8 bcfd as cold weather and winter storms froze oil and gas wells – known as freeze-offs in the energy industry – in several states, including Texas, Oklahoma, Colorado, North Dakota and Pennsylvania. Meteorologists forecast temperatures across much of the U.S. Lower 48 states would remain mostly colder than normal through Feb. 4 before turning warmer than normal from Feb. 5 through at least Feb. 15. Technically market is under fresh selling as the market has witnessed a gain in open interest by 11.31% to settle at 41696 while prices are down -12.3 rupees, now Natural gas is getting support at 203.8 and below same could see a test of 195.7 levels, and resistance is now likely to be seen at 225.9, a move above could see prices testing 239.9.

Trading Ideas:

* Natural gas trading range for the day is 195.7-239.9.
* Natural gas dropped as forecasts for warmer weather and less heating demand next week spooked investors.
* At the same time, the Freeport LNG export facility in Texas was allowed to restart production.
* Putting a floor under prices was a decline in production amid extreme cold in some states.



Copper

Copper yesterday settled down by -0.89% at 780.6 as the Caixin/S&P Global PMI showed China's factory activity shrank more slowly in January after Beijing lifted tough COVID curbs late last year. Physical demand in China was quiet as producers held sufficient stocks that they built up before the holidays, and as consumption from end users remained weak amid lowered orders from both domestic and overseas market. The muted trading has led to a steep rise in inventories for refined copper readily in the market. It rose to 267,500 tonnes on Jan. 30, an increase of 80,800 tonnes from Jan. 19. Still, investors were optimistic at industrial metals demand prospects as the world's top consumer vowed to support its economy and the real estate sector. The huge Chinese-owned Las Bambas copper mine in Peru, normally the supplier of 2% of the metal worldwide, could halt production this week due to protests and blockades that are starting to snarl output of the red metal amid already tight global supply. The Andean nation, the world's second-largest copper producer, has seen growing social unrest since early December, with key mines hit by road blockades and attacks by protesters, mainly impacting transportation of copper rather than production. Technically market is under long liquidation as the market has witnessed a drop in open interest by -5.8% to settle at 4057 while prices are down -7 rupees, now Copper is getting support at 776 and below same could see a test of 771.4 levels, and resistance is now likely to be seen at 786.5, a move above could see prices testing 792.4.

Trading Ideas:

* Copper trading range for the day is 771.4-792.4.
* Copper dropped as China's factory activity shrank more slowly in January after Beijing lifted tough COVID curbs late last year.
* Physical demand in China was quiet as producers held sufficient stocks that they built up before the holidays
* Chinese-owned copper mine in Peru may halt production over unrest


Zinc

Zinc yesterday settled down by -2.11% at 289.95 as China's refined zinc output was 620,000 mt in December 2022, up 4% year-on-year. On the one hand, a large zinc smelter in north-west China completed its annual production target ahead of schedule and controlled its output in December. A smelter in north China was compelled to curtail its refined zinc production due to equipment failure. Despite the above-mentioned output decline, the refine zinc production in December still climbed thanks to the full-capacity operation of smelters in Shaanxi and concentrated production resumption of smelters in Sichuan. LME zinc inventories remain on the decline despite a slower drop, according to LME data. LME zinc stocks hit a multiple-year low and currently stand at 17,425 mt. SHFE zinc inventories grew for four weeks on end, and stood at 44,248 mt, with a weekly gain of 26.07%, the highest in two and a half months. Asia's factory activity contracted in January as the boost from China's COVID reopening had yet to offset headwinds from slowing U.S. and European growth, surveys showed, underscoring the fragility of the region's economic recovery. China's factory activity shrank more slowly in January after Beijing lifted tough COVID curbs late last year, a private sector survey showed. Technically market is under fresh selling as the market has witnessed a gain in open interest by 0.26% to settle at 2314 while prices are down -6.25 rupees, now Zinc is getting support at 286 and below same could see a test of 281.9 levels, and resistance is now likely to be seen at 296.2, a move above could see prices testing 302.3.

Trading Ideas:

* Zinc trading range for the day is 281.9-302.3.
* Zinc dropped as China's refined zinc output was 620,000 mt in December 2022, up 4% year-on-year.
* LME zinc inventories remain on the decline despite a slower drop, according to LME data.
* SHFE zinc inventories grew for four weeks on end, and stood at 44,248 mt, with a weekly gain of 26.07%



Aluminium

Aluminium yesterday settled down by -0.44% at 224.9 on profit booking as most of the aluminium smelters in Yunnan Province are currently maintaining their operating rates at pre-holiday levels. However, downside seen limited amid prospects of more robust demand and fears of supply shortages. China has been taking significant steps to boost its economy and end the strict coronavirus-induced regime, lifting the outlook for metal demand and overshadowing global recession concerns. On the supply side, last year's output cuts at key European smelters, including Alcoa's San Ciprian smelter and Hydro's plant in Slovakia, lent further optimism to bulls. Global inventories now stand at just 1.4 million tons, down 900,000 tons from a year ago and the lowest since 2002. Aluminum hit an all-time high of around 4,100 USD/T in March 2022 in the aftermath of Russia's invasion of Ukraine. The premiums for aluminium shipments to Japanese buyers for January to March were set at $85-$86 a tonne, down 13%-14% from the previous quarter, reflecting slack demand and high stocks, six sources directly involved in pricing talks said. The figures are lower than the $99 per tonne paid in the October-December quarter and mark a fifth consecutive quarterly decline and the lowest premium since the July-September quarter of 2020. Technically market is under fresh selling as the market has witnessed a gain in open interest by 0.74% to settle at 4613 while prices are down -1 rupees, now Aluminium is getting support at 223 and below same could see a test of 220.9 levels, and resistance is now likely to be seen at 227, a move above could see prices testing 228.9.

Trading Ideas:

* Aluminium trading range for the day is 220.9-228.9.
* Aluminum dropped on profit booking as aluminium smelters in Yunnan Province are currently maintaining their operating rates at pre-holiday levels.
* However, downside seen limited amid prospects of more robust demand and fears of supply shortages.
* China has been taking significant steps to boost its economy and end the strict coronavirus-induced regime

Mentha oil

Mentha oil yesterday settled up by 0.64% at 1022.6 on improving export demand especially from China. Mentha exports during Apr-Nov 2022 has dropped by 18.10 percent at 1,485.25 tonnes as compared to 1,813.38 tonnes exported during Apr- 2022 2021. In the month of November 2022 around 236.22 tonnes Mentha was exported as against 141.82 tonnes in October 2022 showing a rise of 66.56%. In the month of November 2022 around 236.22 tonnes of Mentha was exported as against 249.26 tonnes in November 2021 showing a drop of 5.23%. 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 2.5 Rupees to end at 1182.3 Rupees per 360 kgs.Technically market is under short covering as the market has witnessed a drop in open interest by -0.53% to settle at 944 while prices are up 6.5 rupees, now Mentha oil is getting support at 1009.6 and below same could see a test of 996.6 levels, and resistance is now likely to be seen at 1031, a move above could see prices testing 1039.4.

Trading Ideas:

* Mentha oil trading range for the day is 996.6-1039.4.
* In Sambhal spot market, Mentha oil gained  by 2.5 Rupees to end at 1182.3 Rupees per 360 kgs.
* Mentha oil prices gained on improving export demand especially from China.
* Mentha exports during Apr-Nov 2022 has dropped by 18.10 percent at 1,485.25 tonnes
* In the month of November 2022 around 236.22 tonnes of Mentha was exported as against 249.26 tonnes in November 2021



Turmeric

Turmeric yesterday settled down by -0.08% at 7338 on profit booking after gains on reports that production is projected lower by 5 per cent in Telangana due to overall drop in acreage and 20 per cent in Karnataka due to rot disease. The country’s production is estimated at 13.14 lt against 13.29 lt with heavy rains waterlogging the fields and affecting the output. The area under cultivation is lower in most parts of the country, barring Maharashtra. However, there has been no major pest attack and hence, due to the rise in overall area under the crop, the production was expected to be 10 per cent higher. Turmeric exports during Apr-Nov 2022 has rose by 9.90 percent at 1,11,968.51 tonnes as compared to 1,01,882.03 tonnes exported during Apr-Nov 2021. In the month of November 2022 around 12,398.63 tonnes turmeric was exported as against 11,178.11 tonnes in October 2022 showing a rise of 10.92%. In the month of November 2022 around 12,398.63 tonnes of turmeric was exported as against 12,255.64tonnes in November 2021 showing a rise of 1.17%. 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 7255.25 Rupees gained 79.4 Rupees.Technically market is under long liquidation as the market has witnessed a drop in open interest by -0.89% to settle at 13295 while prices are down -6 rupees, now Turmeric is getting support at 7252 and below same could see a test of 7166 levels, and resistance is now likely to be seen at 7432, a move above could see prices testing 7526.

Trading Ideas:

* Turmeric trading range for the day is 7166-7526.
* Turmeric dropped on profit booking after gains on reports that production is projected lower by 5 per cent in Telangana and 20 per cent in Karnataka.
* The country’s production is estimated at 13.14 lt against 13.29 lt with heavy rains waterlogging the fields and affecting the output.
* The area under cultivation is lower in most parts of the country, barring Maharashtra.
* In Nizamabad, a major spot market in AP, the price ended at 7255.25 Rupees gained 79.4 Rupees.


Jeera

Jeera yesterday settled down by -1.17% at 32215 on profit booking after gained amid reduced sowing in Gujarat, coupled with a tight supply, and climatic uncertainties. Projections of lower carryover stock and fears of sowing in key growing regions of Gujarat being affected. Sowing In Gujarat, dropped by nearly -8% with 274,995.00 hectares against sown area of 2021 which was 300,401.00 hectares. Prices gained to all time high amid higher demand for the fresh crop and supply tightness in the physical market. Good demand expected from China in December-January and Ramzan demand during January-February from gulf & other countries. Jeera exports during Apr-Nov 2022 has dropped by 17.40 percent at 133,250.24 tonnes as compared to 161,317.94 tonnes exported during Apr-Nov 2021. In the month of November 2022 around 11,235.11 tonnes jeera was exported as against 12,427.86 tonnes in October 2022 showing a drop of 9.60%. In the month of November 2022 around 11,235.11 tonnes of jeera was exported as against 10,838.83 tonnes in November 2021 showing a rise of 3.66%. 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 -199.6 Rupees to end at 31867.35 Rupees per 100 kg.Technically market is under long liquidation as the market has witnessed a drop in open interest by -1.43% to settle at 4146 while prices are down -380 rupees, now Jeera is getting support at 31610 and below same could see a test of 31010 levels, and resistance is now likely to be seen at 32825, a move above could see prices testing 33440.

Trading Ideas:

* Jeera trading range for the day is 31010-33440.
* Jeera dropped on profit booking after gained amid reduced sowing in Gujarat, coupled with a tight supply, and climatic uncertainties.
* Projections of lower carryover stock and fears of sowing in key growing regions of Gujarat being affected.
* Sowing in Gujarat, dropped by nearly -10% with 275,832.00 hectares against sown area of 2021-22 which was 307,135.00 hectares.
* In Unjha, a key spot market in Gujarat, jeera edged down by -199.6 Rupees to end at 31867.35 Rupees per 100 kg.

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