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Gold

Gold experienced a marginal decline of -0.26% to settle at $59,088 per ounce as unexpected improvements in the U.S. service sector data influenced market sentiment. The Institute for Supply Management (ISM) reported a rise in its Services Purchasing Managers Index (PMI) to 54.5%, surpassing the consensus estimate of 52.5% and July's reading of 52.7%. This positive economic data fueled optimism, leading to a slight dip in gold prices. Furthermore, the U.S. trade deficit in July 2023 widened to $65 billion, although it was less than the forecasted $68 billion gap. Notably, exports increased by 1.6% to reach $251.7 billion, with strong performance in categories such as passenger cars, crude oil, and pharmaceutical preparations.  The precious metals market has been impacted by rising bond yields, prompting investors to move away from gold-backed exchange-traded funds (ETFs). Data from the World Gold Council (WGC) revealed that global physically-backed gold ETFs witnessed their third consecutive month of outflows, shedding 46 tonnes valued at $209 billion. In terms of technical analysis, the market exhibited signs of long liquidation. Open interest decreased by -1.49% to settle at 11,845, while gold prices dipped by -155 rupees. Support for gold is currently at $58,970, and a breach of this level could lead to a test of $58,845. On the flip side, resistance is likely to emerge at $59,260, and a breakthrough above this level could push prices towards $59,425.

Trading Ideas:
* Gold trading range for the day is 58845-59425.
* Gold dropped after activity in the U.S. service sector showed unexpected improvement.
* The ISM said its Services Purchasing Managers Index rose to a reading of 54.5% last month
* The US trade deficit widened less than expected to $65 billion in July 2023 from a downwardly revised $63.7 billion in June


Silver
Silver prices experienced a 1.32% drop, closing at $72,472 per ounce. This decline was influenced by the strengthening US dollar index, which reached a six-month high at 105. The reason behind the dollar's strength was the anticipation of higher interest rates in the US, attributed to the robust performance of the US economy compared to other major economies. Moreover, the US ISM Services PMI for August unexpectedly surged to 54.5, marking the strongest growth in the services sector in six months, surpassing July's 52.7 and beating forecasts of 52.5. However, the S&P Global US Composite PMI revised lower to 50.2, indicating the slowest rate of business activity increase since February due to a weaker service sector and a renewed manufacturing output decline. This resulted in a marginal decrease in total new business, the first since February. As a consequence, the Federal Reserve is expected to keep interest rates steady for now, with a 47% likelihood of a 25bps increase in November. From a technical standpoint, the silver market is witnessing fresh selling pressure. Open interest increased by 6.44%, closing at 14,934 contracts, while prices dropped by -973 rupees. Silver's support level now stands at 71,840, and a breach below this could lead to a test of 71,200. On the flip side, resistance is anticipated at 73,380, and a break above this level could push prices towards 74,280.

Trading Ideas:
* Silver trading range for the day is 71200-74280.
* Silver dropped as dollar index firms at 6-month high
* Pressure seen amid expectations of higher-for-longer interest rates as the US economy is doing much better than other major economies.
* The ISM Services PMI in the US unexpectedly rose to a six-month high in August while PMIs for China and Europe disappointed.

Crude oil

Crude oil prices closed 1.21% higher at $73.05 on the back of a stronger dollar and concerns about supply cuts from Saudi Arabia and Russia. These cuts, extended to year-end, amounted to 1 million and 300,000 barrels per day respectively, compounding the reductions agreed upon by OPEC+ producers. The market remained jittery due to global economic uncertainties, fueled by soft manufacturing and services data in major economies. In June, U.S. crude oil shipments by rail dropped by 23,000 barrels per day to 227,000 bpd, according to the U.S. Energy Information Administration. U.S. crude oil and gasoline inventories were expected to decrease, while distillate stockpiles were anticipated to rise. Notably, U.S. crude oil production reached 12.8 million bpd, the highest since March 2020, reflecting a significant increase of 100,000 bpd. From a technical perspective, the market exhibited signs of fresh buying, with open interest increasing by 5.28% to reach 10,947 contracts. Prices surged by 87 rupees. Crude oil now finds support at 7,195, and a breach of this level could test 7,085. Conversely, resistance is likely to emerge at 7,365, and a break above this level might propel prices towards 7,425.

Trading Ideas:
* Crudeoil trading range for the day is 7085-7425.
* Crude oil rose due to Saudi and Russian supply concerns and a stronger dollar.
* Global economic uncertainties continued to weigh on the demand outlook amid soft manufacturing and services data in major economies.
* U.S. crude by rail shipments fell by 23,000 bpd in June – EIA

Natural gas

Natural gas prices experienced a decline of -2.22% yesterday, settling at 211.4 due to forecasts of cooling weather over the next two weeks. However, several factors tempered these losses. Forecasts indicated higher gas demand over the same period, a decrease in daily gas output, and increased gas flow to liquefied natural gas (LNG) export facilities. On a daily basis, gas output was expected to drop by approximately 2.7 billion cubic feet per day (bcfd), hitting a preliminary five-month low of 99.6 bcfd. This marked the most significant one-day output drop since mid-June, though it's important to note that preliminary data often undergoes revisions later in the day. While the weather in the lower 48 U.S. states was predicted to be less hot than initially anticipated for the next two weeks, meteorologists expected temperatures to remain above normal until at least September 21st. Consequently, the London Stock Exchange Group (LSEG) forecasted that U.S. gas demand, including exports, would remain steady at around 101.2 bcfd for the upcoming week and the one following. These projections represented an increase from LSEG's earlier outlook provided on Tuesday. From a technical perspective, the market displayed signs of fresh selling pressure. Open interest surged by 16.12% to reach 55,424, while prices fell by -4.8 rupees. Currently, natural gas finds support at 207.9, and if it dips below this level, it could potentially test 204.4. On the flip side, resistance is now expected at 216.6, and if prices manage to surpass this level, they may aim for 221.8.

Trading Ideas:
* Naturalgas trading range for the day is 204.4-221.8.
* Natural gas slid on forecasts for the weather to become less hot over the next two weeks.
* Limiting those losses, however, were forecasts for more gas demand over the next two weeks than previously expected
* On a daily basis, however, output was on track to fall about 2.7 bcfd to a preliminary five-month low of 99.6 bcfd on Wednesday.


Copper

Copper faced a decline of -0.93% to settle at 733.55 yesterday. This drop was primarily attributed to a strong U.S. dollar and renewed global economic concerns. The U.S. factory orders for July decreased, reversing the previous month's gains, raising concerns about the economy. Federal Reserve Governor comments also stoked fears of more U.S. interest rate hikes, potentially impacting economic activity and reducing metal demand. Additionally, economic data from China and Europe indicated slowing economic activities, intensifying worries of an impending recession. The International Copper Study Group (ICSG) reported a shift in the global refined copper market from a 196,000-ton deficit in the first six months of the previous year to a surplus of 213,000 metric tons in the same period of 2023. This was driven by increased output in China and the Democratic Republic of Congo (DRC), even though production declined in other regions. Overall refined copper production grew by 7% to 13.5 million tons. Global copper mine production also saw a 2% increase, despite operational challenges in various countries and community protests in Peru. Technically, the copper market is experiencing fresh selling pressure, with a 7.4% rise in open interest to 5499 contracts, coupled with a price decrease of -6.9 rupees. Copper's support level is at 730.4, and a breach below could test 727.3 levels. On the upside, resistance is anticipated at 738.7, and a move above this level could push prices to test 743.9.

Trading Ideas:
* Copper trading range for the day is 727.3-743.9.
* Copper dropped weighed down by renewed global economic concerns.
* Orders for U.S. factory goods declined in July, nearly reversing the prior month's rise
* Data released by China and Europe lately reinforced slowing economic activities and fanned fears over an economic recession

Zinc

Zinc showed resilience in its price performance, edging up by 0.11% to settle at 220.75, despite concerning economic data from China and Europe hinting at a slowdown and fears of a looming recession. China's refined zinc output in August witnessed a notable decline of 4.46% month-on-month, totaling 526,500 tons, which was considerably lower than expected. However, the year-on-year increase of 13.78% provided a silver lining. Cumulatively, refined zinc production from January to August stood at 4,304,000 tons, marking a 10.08% year-on-year rise. China's economic woes persisted, with services activity expanding at its slowest pace in eight months. Euro zone also faced a worsening business activity decline. On the global stage, the zinc market witnessed a surplus of 76,000 metric tons in June, up from 67,000 tons the previous month, according to the International Lead and Zinc Study Group (ILZSG). This increase was part of a trend that saw a surplus of 370,000 metric tons in the first half of the year, compared to 241,000 tons during the same period the previous year. From a technical perspective, the market experienced short covering, resulting in a drop in open interest by -0.26% to settle at 4225. Zinc's price saw a modest increase of 0.25 rupees. Key support levels for Zinc are at 219.3, with a potential further downside test at 217.9. Conversely, resistance levels are now expected at 222, and a breakthrough above could push prices to test 223.3.

Trading Ideas:
* Zinc trading range for the day is 217.9-223.3.
* Zinc rose 0.11% as China's zinc output fell in August.
* Services in China slowed, Euro zone business declined.
* China eased homebuyer borrowing rules to boost the economy.


Aluminium

Aluminium prices saw a 0.32% increase, settling at 201.35, driven by China's determined efforts to boost its economy. China's central bank's actions to ease regulations on residential housing loans, along with a historic reduction in the one-year loan prime rate, signaled a clear intent to stimulate economic activity and ensure financial stability. These measures seem to be having an impact, as a private-sector survey revealed a surprising return to expansion in China's factory activity in August. This expansion was driven by improvements in supply, domestic demand, and employment. Furthermore, the reduction in aluminium stocks at major Japanese ports (down 1.9% to 350,600 metric tons) signals increasing demand. China's Yunnan province's decision to increase energy-intensive aluminium production following the end of power curbs also contributes to this demand. LME's data reveals interesting trends. Cancelled warehouse receipts for LME aluminum have surged to 281,050 tons, with a cancellation rate of 55.50%. However, registered warehouse receipts have decreased, currently standing at 225,350 tons. This data hints at shifting dynamics in the aluminium market. From a technical standpoint, the market is undergoing short covering, with a drop in open interest by -1.68% to settle at 3,930. Meanwhile, prices have increased by 0.65 rupees. Aluminium now finds support at 200.6, with potential testing of 199.7 levels. On the upside, resistance is likely at 202.6, and a breakthrough could lead to prices testing 203.7.

Trading Ideas:
* Aluminium trading range for the day is 199.7-203.7.
* Aluminium gains driven by China's efforts to bolster its economy.
* China's factory activity surprisingly returned to expansion in August, a private-sector survey showed
* Aluminium stocks at three major Japanese ports slipped 1.9% to 350,600 metric tons as of end-July

Cottoncandy

Cottoncandy settled slightly higher, up by 0.07% at 60,980 as India grapples with a 3.65 lakh hectare drop in cotton sowing compared to the previous year. This decline is primarily attributed to poor monsoon conditions in Gujarat, where rain has been insufficient. Additionally, the closure of major mills and a low stock of old cotton crops have further exacerbated the tight local supplies of cotton. The arrival of the new cotton crop has started in parts of North and South India, with prices hovering above the minimum support price (MSP) levels. These arrivals are slightly ahead of schedule, with around 3,000 bales arriving daily. Market experts anticipate a gradual increase in demand, particularly post-September 15. The overall quality of the cotton crop this year is reported to be better than the previous year, although there have been reports of pink bollworm attacks in Punjab. In regions like Telangana, Andhra, and Karnataka, raw cotton arrivals have begun, driven by farmers using borewell water to cultivate their crops. In the Rajkot spot market, cotton prices ended at 29,635.4 Rupees, showing a marginal 0.01% gain. From a technical perspective, the market is currently experiencing short-covering, while prices have increased by 40 rupees. Cottoncandy is finding support at 60,920 levels, and if this support is breached, it could test the 60,860 levels. On the upside, resistance is likely to be encountered at 61,020, and a breakout above this level could push prices towards 61,060.

Trading Ideas:
* Cottoncandy trading range for the day is 60860-61060.
* Cotton settled flat as New cotton crop arrivals in North and South India have begun
* In Gujarat, Cotton sowing grows by nearly 5% with 2,679,346.00 hectares against sown area of 2022
* Cotton acreage stood at 122.99 lakh hectares as on September 1 compared with 125.63 lakh hectares a year ago.
* In Rajkot, a major spot market, the price ended at 29635.4 Rupees gained by 0.01 percent.

Turmeric

Turmeric experienced a 0.41% increase in prices on the previous day, closing at 15,110. This upswing can be attributed to a surge in festive demand in the market. However, several factors are set to impact its price dynamics in the coming days. One of the primary drivers of this uptrend is the limited availability of high-quality turmeric crops, coupled with a bleak production outlook for the upcoming season. These factors are expected to maintain price stability. Nonetheless, the anticipated good rainfall in September due to the revival of the Southwest Monsoon might cap the gains in turmeric prices. This rain is forecasted to benefit central and southern regions of India, which could potentially boost crop yields. Export inquiries have been lackluster at current price levels, which could exert downward pressure on prices. Furthermore, there's a notable shift in farmers' focus, with expectations of a 20-25% reduction in turmeric cultivation, particularly in states like Maharashtra, Tamil Nadu, Andhra Pradesh, and Telangana. In terms of exports, there has been a 16.87% increase in turmeric exports from April to June 2023 compared to the same period in the previous year. This indicates strong international demand. From a technical standpoint, the market is currently witnessing fresh buying interest, with open interest rising by 0.25% to settle at 16,015. Turmeric prices have increased by 62 rupees. Key support is found at 14,892, with the possibility of testing 14,676 if this level is breached. On the upside, resistance is expected at 15,312, and a move above this level could lead to prices testing 15,516.

Trading Ideas:
* Turmeric trading range for the day is 14676-15516.
* Turmeric prices gained by emerging festive demand .
* Limited availability of quality crop and bleak production outlook for upcoming season is likely to support firmness in prices.
* Gains in turmeric is likely to be limited in wake of forecast of good rainfall in September.
* In Nizamabad, a major spot market, the price ended at 14045.2 Rupees gained by 0.49 percent.

Jeera

Jeera prices experienced a slight setback of -0.47% to settle at 59730, primarily due to profit booking, following a period of increased buying activities in the market. Stockists have displayed a growing interest, driven by the rising festive demand. Notably, millers are actively purchasing jeera on price dips, owing to drier inventory conditions. However, the concern lingers as bleak export inquiries continue to cast a shadow. Demand from China, a major buyer of Indian jeera, has dwindled in recent weeks, potentially capping future gains. The market also faces uncertainty regarding China's potential purchase of Indian cumin in October-November, before the arrival of new cumin crops. Furthermore, the anticipation of drier weather conditions in Gujarat could lead to increased arrivals, potentially limiting upward price movements. According to FISS forecasts, cumin demand is projected to surpass 85 lakh bags this year, while the expected supply stands at 65 lakh bags. Export data for jeera indicates mixed trends. During April-June 2023, jeera exports increased by 13.16% compared to the same period in 2022, reaching 53,399.65 tonnes. From a technical perspective, the market is currently undergoing a phase of long liquidation, marked by a 7.37% decrease in open interest, settling at 4752 contracts. Prices have declined by -285 rupees. Jeera's immediate support level is at 58790, and a breach below this could lead to testing the 57860 level. On the flip side, resistance is anticipated around 60490, and surpassing this level might push prices towards 61260.

Trading Ideas:
* Jeera trading range for the day is 57860-61260.
* Jeera dropped on profit booking after prices gained as Stockists are showing interest in wake of rising festive demand.
* Bleak export enquires are still a concern for exporters as demand from China has dropped in recent weeks
* Drier weather condition in Gujarat will also lead to rise in arrivals that will cap the upwards move.
* In Unjha, a major spot market, the price ended at 60237.65 Rupees gained by 0.27 percent.

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