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Gold

Gold yesterday settled up by 1.06% at 59763 bolstered by a softer dollar and lower Treasury yields, while investors focused on the outlook for the Federal Reserve's monetary policy path beyond its July 25-26 meeting. U.S. retail sales rose less than expected in June, though consumer spending appeared to be solid, which likely kept the economy afloat in the second quarter. U.S. Treasury Secretary Janet Yellen said a cooling but not faltering labor market is playing a leading role in helping slow inflation, among a raft of factors imposing disinflationary pressures. Yellen also told in an interview that the United States was making good progress in bringing inflation down and she did not expect the U.S. economy to enter a recession. International Monetary Fund data shows official gold reserves declined by 71 metric tons in April, the first net decrease in over a year. Bets for a 25bps hike in the fed funds rate next week currently stand at 96% but investors remain divided on the need of further increases, although several officials including Chair Powell and Governor Waller have been advocating for another increase in borrowing costs beyond July. Bets for a September increase currently stand at 12% and for November at 24%. Technically market is under fresh buying as the market has witnessed a gain in open interest by 4.6% to settle at 8684 while prices are up 628 rupees, now Gold is getting support at 59348 and below same could see a test of 58934 levels, and resistance is now likely to be seen at 60043, a move above could see prices testing 60324.

Trading Ideas:
* Gold trading range for the day is 58934-60324.
* Gold rose bolstered by a softer dollar and lower Treasury yields
* Dollar wobbles near more than one-year low
* US retail sales edge up in June

Silver

Silver yesterday settled up by 0.71% at 76103 as dollar index held below 100 after data showed retail sales rose for the third straight month, up by a less-than-expected 0.2%. Retail sales in the US rose 0.2% month-over-month in June of 2023, following an upwardly revised 0.5% increase in May, but below forecasts of a 0.5% rise. Softer-than-expected US inflation data raised hopes that the Federal Reserve may be close to the end of its current monetary policy tightening cycle. Still, the US central bank is widely expected to raise interest rates by 25 basis points this month, while traders scaled back bets of further rate increases this year. Market pricing also suggests that the Fed could start cutting rates next year. On the data front, a report showed that US consumer sentiment hit a near two-year high in July. Solar panel companies are expected to make up 14% of global silver consumption, compared to 5% in 2014, and driving an expected 4% increase in consumption this year. The figure compares to a slower 2% rise in output, flagging fresh deficit concerns and driving silver to outperform gold since the start of the month. Technically market is under fresh buying as the market has witnessed a gain in open interest by 3.93% to settle at 19603 while prices are up 536 rupees, now Silver is getting support at 75542 and below same could see a test of 74980 levels, and resistance is now likely to be seen at 76563, a move above could see prices testing 77022.

Trading Ideas:
* Silver trading range for the day is 74980-77022.
* Silver gained as dollar index held below 100 after
* Retail sales in the US rose 0.2% month-over-month in June of 2023, following an upwardly revised 0.5% increase in May.
* U.S. Treasury Secretary Janet Yellen said she did not expect the economy to enter a recession.
 

Crude oil 

Crude oil yesterday settled up by 2.07% at 6224 amid signs of tightening US oil supplies. Data from the Energy Information Administration showed US shale oil production is expected to drop to nearly 9.4 million barrels per day in August, the first such decline since December. Meanwhile, oil prices lost nearly 2% in the previous session as weaker Chinese economic growth raised concerns about demand in the world’s top crude importer. The country’s economy grew by a lower-than-expected 6.3% in the second quarter amid slowing demand from both domestic and international sources. Additionally, two of the three Libyan oil fields shut last week resumed production, bringing a total output capacity of 370,000 barrels per day back to the market. Still, global supplies are expected to see a boost from the resumption of output at two of three Libyan fields that were shuttered last week. Nigeria's oil output dropped month-on-month, MoM, by 5.5 per cent to 1.249 million barrels per day, mb/d, in June 2023, from 1.184 million mb/d in May 2023. Also, on year-on-year, YoY, the nation’s oil output dropped by 17.6 per cent to 1.249 mb/d in June 2023, from 1.515 mb/d in the corresponding period of 2022. Technically market is under fresh buying as the market has witnessed a gain in open interest by 5.39% to settle at 6378 while prices are up 126 rupees, now Crude oil is getting support at 6120 and below same could see a test of 6017 levels, and resistance is now likely to be seen at 6279, a move above could see prices testing 6335.
 

Trading Ideas:
* Crude oil trading range for the day is 6017-6335.
* Crude oil rose amid signs of tightening US oil supplies.
* US shale oil production is expected to drop to nearly 9.4 million barrels per day in August.
* Two of the three Libyan oil fields shut last week resumed production, bringing a total output capacity of 370,000 barrels per day

Natural Gas

Nat.Gas yesterday settled up by 4.28% at 216.8 on forecasts for the weather to remain hotter-than-normal through early August, especially in Texas. That price increase came despite rising output, forecasts for less demand next week than previously expected and lower than usual amounts of gas flowing to U.S. liquefied natural gas (LNG) export plants due to ongoing maintenance outages. The U.S. Energy Information Administration (EIA) said that U.S. natural gas storage injections have exceeded the five-year average so far this summer as production in the Lower 48 states has outpaced demand. Since April, net injections into natural gas storage have exceeded the five-year (2018–22) average by 6%, and inventories have reached 69% of operating gas capacity throughout the refill season, the EIA said. Total working natural gas inventories have totaled 2,930 billion cubic feet (Bcf) as of July 7, as per the latest weekly natural gas storage report by EIA. Meteorologists forecast the weather in the Lower 48 states would remain hotter-than-normal through at least Aug. 2. Refinitiv forecast U.S. gas demand, including exports, would hold near 108.6 bcfd this week and next. The forecast for next week was lower than Refinitiv's outlook. Technically market is under short covering as the market has witnessed a drop in open interest by -34.74% to settle at 16026 while prices are up 8.9 rupees, now Natural gas is getting support at 211 and below same could see a test of 205.1 levels, and resistance is now likely to be seen at 220.1, a move above could see prices testing 223.3.

Trading Ideas:
* Natural gas trading range for the day is 205.1-223.3.
* Natural gas climbed on forecasts for the weather to remain hotter-than-normal
* That price increase came despite rising output, forecasts for less demand next week.
* US natgas storage injections exceed 5 – yr average this summer – EIA

Copper

Copper yesterday settled down by -0.2% at 724.75 as investors continued to assess the impact of slow economic growth of top metals consumer China. Metals have come under pressure at the start of the week following China's second-quarter gross domestic product data, which came in below expectations, adding to concerns over the health of the Chinese economy. China's gross domestic product grew 0.8% in April-June from the previous quarter compared with a 2.2% expansion in the first quarter as demand weakened at home and abroad, data showed. Beijing said it would roll out policies on consumption recovery and expansion, boost automobile and electronics demand and increase household income, but that has so far failed to improve investors confidence in demand for metals from the world's second largest economy. China's copper imports fell 16.4% in June from a year earlier, customs data showed, weighed down by a combination of strong domestic production and weak demand in the world's top consumer of the metal. Imports of unwrought copper and copper products totalled 449,649 metric tons in June, data from the General Administration of Customs showed. Technically market is under long liquidation as the market has witnessed a drop in open interest by -6.42% to settle at 3793 while prices are down -1.45 rupees, now Copper is getting support at 721.2 and below same could see a test of 717.7 levels, and resistance is now likely to be seen at 728, a move above could see prices testing 731.3.
 

Trading Ideas:
* Copper trading range for the day is 717.7-731.3.
* Copper fall as weak China growth worsens demand outlook
* Metals have come under pressure at the start of the week following China's second-quarter gross domestic product data.
* China's copper imports fell 16.4% in June from a year earlier, customs data showed.

Zinc

Zinc yesterday settled down by -0.37% at 214.1 after daily LME data showed that inventories in the exchange-registered warehouses rose by 15% to 80,375 tonnes, the highest in nearly three weeks. Second-quarter data showed China's economy grew only 0.8% from the previous quarter as demand weakened at home and abroad, with post-COVID momentum faltering rapidly and raising pressure on policymakers to deliver more stimulus. China’s output reached 3.23 million mt in H1, a year-on-year increase of 8.59%. Data showed that the domestic refined zinc output stood at 552,500 mt in June, down 2.13% MoM and 13.1% YoY. In June, the reduction of domestic smelters was mainly concentrated in Guangxi, Henan, Shaanxi, Hunan and other places, and the overall impact was less than expected, mainly because the supply of zinc concentrate was relatively abundant and some smelters resumed or raised production. Some secondary zinc smelters intend to increase production in advance considering the summer power cut and high electricity prices. Except for some smelters in Hunan who will reduce production, other regions have entered a regular maintenance cycle, and the maintenance is mainly concentrated in Inner Mongolia, Shaanxi and Gansu. Technically market is under fresh selling as the market has witnessed a gain in open interest by 5.93% to settle at 2572 while prices are down -0.8 rupees, now Zinc is getting support at 212.7 and below same could see a test of 211.4 levels, and resistance is now likely to be seen at 215.3, a move above could see prices testing 216.6.

Trading Ideas:
* Zinc trading range for the day is 211.4-216.6.
* Zinc dropped after LME inventories rose to highest in nearly three weeks.
* LME data showed that inventories in the exchange-registered warehouses rose by 15% to 80,375 tonnes
* China’s output reached 3.23 million mt in H1, a year-on-year increase of 8.59%.

Aluminium

Aluminium yesterday settled down by -1.18% at 197.3 as smelters started to resume production in the southwestern Yunnan province after curbs on local power usage were eased. China's aluminium imports in the first half of 2023 rose 10.7% from a year earlier, customs data showed, with domestic supplies constrained by power woes and demand expectations. The world's biggest aluminium producer and consumer imported 1.2 million metric tons of unwrought aluminium and products -including primary metal and unwrought, alloyed aluminium – from January to June, according to data from the General Administration of Customs. June imports totalled 211,235 metric tons, 12.8% higher than the 187,362 metric tons imported in the same month of 2022, also up from the 191,701 tonnes in May. Domestic production growth was limited this year, largely due to the hydro-power shortage in the southwestern Yunnan province. China's aluminium production rose 2.9% to 3.46 million metric tons in June versus a year earlier, according to data released by the National Bureau of Statistics. For the first half this year, China produced 20.16 million metric tons, up 3.4% from the same period last year, the data showed. Technically market is under long liquidation as the market has witnessed a drop in open interest by -4.57% to settle at 2796 while prices are down -2.35 rupees, now Aluminium is getting support at 196.4 and below same could see a test of 195.3 levels, and resistance is now likely to be seen at 199.3, a move above could see prices testing 201.1.

Trading Ideas:
* Aluminium trading range for the day is 195.3-201.1.
* Aluminium dropped as smelters started to resume production in Yunnan
* China's aluminium imports rise 10.7% y/y in H1
* China June aluminium output 3.46 mln metric tons

Mentha oil

Mentha oil yesterday settled down by -0.08% at 889.6 due to reports of improved crop progress. Yield is likely to increase due to favorable weather condition in major producing states. Moreover, reports of slack export of menthol will put pressure on prices. Rising menthol imports, as well as China's limited purchasing, will put pressure on pricing. Mentha exports during Apr-May 2023, dropped by 51.60 percent to 183.98 tonnes as compared to 380.12 tonnes exported during Apr-May 2022. In May 2023 around 86.13 tonnes of Mentha was exported as against 97.85 tonnes in April 2023 showing a drop of 13.60%. In May 2023 around 86.13 tonnes of Mentha was exported as against 209.90 tonnes in May 2022 showing a drop of 58.96%. 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 dropped by -1.9 Rupees to end at 1028 Rupees per 360 kgs.Technically market is under long liquidation as the market has witnessed a drop in open interest by -9.05% to settle at 633 while prices are down -0.7 rupees, now Mentha oil is getting support at 885.2 and below same could see a test of 880.7 levels, and resistance is now likely to be seen at 896, a move above could see prices testing 902.3.

Trading Ideas:
* Mentha oil trading range for the day is 880.7-902.3.
* In Sambhal spot market, Mentha oil dropped  by -1.9 Rupees to end at 1028 Rupees per 360 kgs.
* Menthaoil dropped due to reports of improved crop progress.
* Yield is likely to increase due to favorable weather condition in major producing states.
* Moreover, reports of slack export of menthol will put pressure on prices.

Turmeric 

Turmeric yesterday settled down by -0.48% at 12150 on profit booking after prices rose driven by consistent demand from the domestic market and export. Moreover, farmers and stockists are holding onto their stocks in anticipation of price increases due to lower sowing acreage and also lower ending stocks, resulting in a supply shortage in the cash markets. The kharif sowing acreage is expected to decrease during the current season. In Maharashtra, the sowing area is projected to decline by 10%-20%. Similarly, in Tamil Nadu, the acreage is expected to decrease by 10%-15%. In Andhra Pradesh and Telangana, there is an anticipated decline of 18%-22% in the acreage compared to the previous season. 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 exports during Apr-May 2023, rose by 27.55 percent at 39,418.73 tonnes as compared to 30,903.38 tonnes exported during Apr-May 2022. In May 2023 around 19,827.86 tonnes of turmeric was exported as against 19,590.87 tonnes in April 2023 showing a rise of 1.21%. In May 2023 around 19,827.86 tonnes of turmeric was exported as against 17,138.35 tonnes in May 2022 showing a rise of 15.69%. In Nizamabad, a major spot market in AP, the price ended at 11086.35 Rupees gained 586.9 Rupees.Technically market is under fresh selling as the market has witnessed a gain in open interest by 1.01% to settle at while prices are down -58 rupees, now Turmeric is getting support at 11788 and below same could see a test of 11426 levels, and resistance is now likely to be seen at 12446, a move above could see prices testing 12742.
 

Trading Ideas:
* Turmeric trading range for the day is 11426-12742.
* Turmeric fell on profit booking after supply concerns drove prices up
* Farmers and stockists are holding onto their stocks in anticipation of price increases due to lower sowing acreage
* In May 2023 around 19,827.86 tonnes of turmeric was exported as against 19,590.87 tonnes in April 2023 showing a rise of 1.21%.
* In Nizamabad, a major spot market in AP, the price ended at 11086.35 Rupees gained 586.9 Rupees.

Jeera

Jeera yesterday settled down by -0.42% at 60255 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. Cumin imports in May 2023 reached 210 metric tons, showing a substantial increase of 227.73% compared to the previous month's import volume of 64 metric tons. India's imports are likely to rise in the upcoming months due to the expectation of continued high prices in the Indian market this season. According to FISS forecasts, cumin demand is predicted to exceed 85 lakh bags this year, with a likely supply of 65 lakh bags. Jeera exports during Apr-May 2023, rose by 67.90 percent at 42,988.50 tonnes as compared to 25,603.35 tonnes exported during Apr-May 2022. In May 2023 around 25,903.63 tonnes of jeera was exported as against 17,084.87 tonnes in April 2023 showing a rise of 51.52%. In May 2023 around 25,903.63 tonnes of jeera was exported as against 14,894.62 tonnes in May 2022 showing a rise of 73.91%. In Unjha, a key spot market in Gujarat, jeera edged up by 907.35 Rupees to end at 60839.85 Rupees per 100 kg.Technically market is under long liquidation as the market has witnessed a drop in open interest by -1.67% to settle at while prices are down -255 rupees, now Jeera is getting support at 59310 and below same could see a test of 58370 levels, and resistance is now likely to be seen at 61595, a move above could see prices testing 62940.
 

Trading Ideas:
* Jeera trading range for the day is 58370-62940.
* Jeera dropped on profit booking after prices rose amid less stock and good demand.
* Traders are avoiding bulk buying in anticipation of rise in seasonal supply of jeera in Gujarat and Rajasthan.
* The market is expecting a lower yield and quality of jeera this season
* In Unjha, a key spot market in Gujarat, jeera edged up by 907.35 Rupees to end at 60839.85 Rupees per 100 kg.

 

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