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Gold

Gold yesterday settled up by 0.2% at 58490 as markets geared up for the Federal Reserve's Jackson Hole symposium for clues on where interest rates might settle. Fed officials at their last meeting largely remained concerned that inflation would fail to recede and suggested they may continue raising interest rates. “Most participants continued to see significant upside risks to inflation, which could require further tightening of monetary policy,” according to minutes of the U.S. central bank’s July 25-26 policy meeting published Wednesday in Washington. “Some participants commented that even though economic activity had been resilient and the labor market had remained strong, there continued to be downside risks to economic activity and upside risks to the unemployment rate,” the Fed said. Asian ETFs bought $132 million of gold in July, largely propelled by surging Japanese demand with inflows totaling $170 million. The influx of Japanese demand to ETFs can be attributed to local investors seeking refuge in the metal amid concerns of persistent inflation. The World Gold Council (WGC) separately reported that the People's Bank of China purchased 23 tons of gold in July, the ninth consecutive month of purchasing. Technically market is under short covering as the market has witnessed a drop in open interest by -3.78% to settle at 12866 while prices are up 115 rupees, now Gold is getting support at 58300 and below same could see a test of 58110 levels, and resistance is now likely to be seen at 58660, a move above could see prices testing 58830.
Trading Ideas:
* Gold trading range for the day is 58110-58830.
* Gold remained in range ahead of Fed's Jackson Hole symposium
* SPDR Gold Trust holdings up after string of outflows
* Asian ETFs bought $132 million of gold in July, largely propelled by surging Japanese demand.


Silver

Silver yesterday settled up by 2.03% at 71662 on prospects that interest rates remain elevated for some time. Investors grew confident that Federal Reserve Chair Jerome Powell's speech at the annual symposium in Jackson Hole this week could set the stage for an extended period of higher interest rates. Still, demand for commodity is expected to increase. Efforts to curb carbon emissions sped up the development of solar panel technologies that need higher conduction needs, causing sharp upgrades in forecasts for the commodity's demand. Solar panel companies are expected to make up 14% of global silver consumption, compared to 5% in 2014. Minutes of the FOMC released a few days earlier had shown the Fed to be persistent in its focus on inflation combat. The CME FedWatch tool currently shows a probability of 11.5 percent for a rate hike of 25 basis points in the review due on September 20. The probability for a quarter-point rate hike in November is however higher at 35.5 percent. Producer prices in Germany declined by 6.0% yoy in July 2023, reversing from a 0.1% rise in June while pointing to a first drop since November 2020. Technically market is under short covering as the market has witnessed a drop in open interest by -21.18% to settle at 11594 while prices are up 1427 rupees, now Silver is getting support at 70680 and below same could see a test of 69705 levels, and resistance is now likely to be seen at 72180, a move above could see prices testing 72705.
Trading Ideas:
* Silver trading range for the day is 69705-72705.
* Silver gains on prospects that interest rates remain elevated for some time.
* Fed to be persistent in its focus on inflation combat.
* Solar panel companies are expected to make up 14% of global silver consumption, compared to 5% in 2014.


Crudeoil

Crudeoil yesterday settled down by -0.77% at 6674 weighed down by concerns about the outlook for energy demand due to a slowing Chinese economy. Output cuts from OPEC+ majors Saudi Arabia and Russia have been boosting oil prices since June and the latest data showed US crude inventories shrunk to their lowest levels since January. Meanwhile, China’s central bank urged banks to increase lending in a bid to shore up the economy but Chinese banks opted for a smaller-than-anticipated reduction in their benchmark lending rate on Monday, and they refrained from adjusting the reference rate for mortgages. Money managers cut their net long U.S. crude futures and options positions in the week to August 15, the U.S. Commodity Futures Trading Commission (CFTC) said. The speculator group cut its combined futures and options position in New York and London by 28,752 contracts to 149,939 during the period. U.S. oil output from top shale-producing regions is set to fall in September to its lowest level since May 2023, U.S. Energy Information Administration data showed. U.S. oil output is expected to fall to 9.41 million barrels per day (bpd) in September, EIA data showed. It had touched 9.45 million bpd in July, its highest on record. Technically market is under long liquidation as the market has witnessed a drop in open interest by -2.87% to settle at 3626 while prices are down -52 rupees, now Crudeoil is getting support at 6624 and below same could see a test of 6575 levels, and resistance is now likely to be seen at 6760, a move above could see prices testing 6847.
Trading Ideas:
* Crudeoil trading range for the day is 6575-6847.
* Crude oil dropped weighed down by concerns about the outlook for energy demand
* US oil output from top shale regions set to fall in September – EIA
* U.S. crude oil and gasoline inventories fell last week, while distillate stockpiles rose.

Naturalgas

Naturalgas yesterday settled up by 3.02% at 218.6 on forecasts for the weather to remain hotter than normal through early September, keeping air conditioning demand high, especially in Texas. That price increase occurred despite forecasts for less demand over the next two weeks than previously expected. The U.S. National Hurricane Center (NHC) projected a tropical cyclone could form in the Gulf of Mexico this week and hit the South Texas coast in a few days. Data provider Refinitiv said average gas output in the U.S. Lower 48 states has eased to 101.7 billion cubic feet per day (bcfd) so far in August from 101.8 bcfd in July. That compares with a monthly record of 102.2 bcfd in May. Meteorologists forecast the weather in the Lower 48 states will remain mostly hotter than normal through at least Sept. 5. Even though temperatures will remain higher than usual for weeks, Refinitiv forecast U.S. gas demand, including exports, would ease from 102.6 bcfd this week to 101.8 bcfd next week due to a seasonal cooling of the weather. Those forecasts were lower than Refinitiv's outlook on Friday. Technically market is under short covering as the market has witnessed a drop in open interest by -25.28% to settle at 29127 while prices are up 6.4 rupees, now Naturalgas is getting support at 215.1 and below same could see a test of 211.6 levels, and resistance is now likely to be seen at 221.7, a move above could see prices testing 224.8.
Trading Ideas:
* Naturalgas trading range for the day is 211.6-224.8.
* Natural gas gained on forecasts for the weather to remain hotter than normal
* That price increase occurred despite forecasts for less demand over the next two weeks than previously expected.
* US NHC projected a tropical cyclone could form in the Gulf of Mexico this week and hit the South Texas coast in a few days



Copper

Copper yesterday settled up by 0.42% at 728.7 lifted by better sentiment as China's central bank vowed to resolve local government debt risks, while low stocks also lent some supports. Financial departments should coordinate support to resolve local debt risks, enrich tools to prevent and resolve debt risks, strengthen risk monitoring and firmly hold the line on avoiding systemic risk, China's central bank said in a statement. China cut its one-year benchmark lending rate, as expected, as authorities seek to ramp up efforts to stimulate credit demand, but surprised markets by keeping the five-year rate unchanged. Copper stocks on SHFE fell 25.9% on-week last Friday to 39,228 tons, the lowest since September 2022. Net long positions of copper on the London Metals Exchange (LME) are at a six-month high, partly fuelled by low Chinese copper inventories data. Combined inventory in the Shanghai Futures Exchange and Chinese bonded warehouses were 110,314 metric tonnes on Aug. 11, down 53% year-on-year and equivalent to just under three days of consumption. Chinese copper stocks readily available in the spot market, which includes stocks in warehouses of the Shanghai Futures Exchange, totalled 82,600 tonnes on Aug. 14, up 17.5% year-on-year. Technically market is under short covering as the market has witnessed a drop in open interest by -9.95% to settle at 4002 while prices are up 3.05 rupees, now Copper is getting support at 725.3 and below same could see a test of 721.8 levels, and resistance is now likely to be seen at 731.1, a move above could see prices testing 733.4.
Trading Ideas:
* Copper trading range for the day is 721.8-733.4.
* Copper gains as China's central bank vowed to resolve local government debt risks
* Copper stocks on SHFE fell 25.9% on-week last Friday to 39,228 tons, the lowest since September 2022.
* China's central bank injected more money into the market to support the economy.

Zinc

Zinc yesterday settled up by 0.36% at 210.25 as China's central bank injected more money into the market to support the economy. Zinc inventories in LME-registered warehouses have surged to a 17-month high, highlighting a market surplus amid weak demand. Backwardation in LME zinc strengthened, with the cash contract at a $12.50-a-ton discount to the three-month contract, the biggest discount since July 21, as inventories in LME-registered warehouses surged. The jump in zinc inventories took place ahead of the expiry of LME monthly futures contracts, when investors can deliver physical metal into LME warehouses to satisfy their futures positions. Looking forward, S&P Global anticipates a moderate growth of 1.4% in the worldwide demand for refined zinc in 2023, influenced by ongoing inflation and stringent monetary policies in both the US and Europe. Meanwhile, weak manufacturing data and a struggling property sector suggested more stimulus is needed to enhance the world's largest economy. China is targeting 5% annual growth this year. After July economic activity data failed to match expectations, an increasing number of economists are warning that it could miss the goal unless Beijing ramps up support measures. Technically market is under short covering as the market has witnessed a drop in open interest by -4.05% to settle at 3100 while prices are up 0.75 rupees, now Zinc is getting support at 208.7 and below same could see a test of 207.2 levels, and resistance is now likely to be seen at 211.2, a move above could see prices testing 212.2.
Trading Ideas:
# Zinc trading range for the day is 207.2-212.2.
# Zinc gains as China's central bank injected more money to support economy
# Zinc inventories in LME-registered warehouses have surged to a 17-month high
# S&P Global anticipates a moderate growth of 1.4% in the worldwide demand for refined zinc in 2023


Aluminium

Aluminium yesterday settled remain unchanged by 0% at 197.25 as China's Yunnan province started ramping up energy-intensive aluminium production after the end of power curbs. Data from the International Aluminium Institute (IAI) revealed that global primary aluminum production in July declined by 0.5% compared to the previous year, reaching a total of 5.861 million tonnes. Global primary aluminium output rose by 1.8% year on year in the first half of 2023, mainly owing to higher production in China, according to the International Aluminium Institute. In July China's output rose to near-record levels. Sentiment surrounding the construction sector has deteriorated further with the suspension of bond trading by Country Garden. The discount on aluminium for near-term delivery compared with the three-month contract on the London Metal Exchange (LME) has reached its highest since the global financial crisis of 2008, indicating weak demand and rising supply. The discount, or contango, for cash aluminium against the three-month contract climbed to $55.50 a metric tonne for its highest level since November 2008. That compared to a premium, or backwardation, of $40.50 at the end of May. China's commerce ministry demanded that the United States immediately lift the tariffs imposed on Chinese steel and aluminium imports. Technically market is under long liquidation as the market has witnessed a drop in open interest by -20% to settle at 2348 while prices are remain unchanged 0 rupees, now Aluminium is getting support at 196.3 and below same could see a test of 195.3 levels, and resistance is now likely to be seen at 198, a move above could see prices testing 198.7.
Trading Ideas:
* Aluminium trading range for the day is 195.3-198.7.
* Aluminium remained in range as China's Yunnan started ramping up production.
* Global aluminium output falls 0.5% year on year in July – IAI
* Weak demand sends near term LME aluminium discount to highest since 2008

Cottoncandy

Cottoncandy yesterday settled down by -0.23% at 59840 as economic concerns surrounding top buyer China clouded the demand outlook for the natural fiber. Global cotton production will likely decline next season (October 2023-September 2024) by three per cent, while consumption may remain stagnant and ending stocks could be lower. Cotton Association of India (CAI) maintained the cotton crop production forecast for the 2022-23 season at 311.18 lakh bales. The total cotton supply for October 2022 to July 2023 is estimated at 332.30 lakh bales, which consists of arrivals of 296.80 lakh bales, imports of 11.50 lakh bales and the opening stock estimated by the CAI at 24 lakh bales at the beginning of the season. Arrivals in Punjab have been recorded at almost one-third of the previous year, 2021-22. In Punjab the arrival of cotton in the 2022-23 marketing season has been recorded at 8.7 lakh quintal till date this year, while it was 28.89 lakh quintal for the entire 2021-22 season. USDA weekly export sales report showed net sales of 277,700 running bales of cotton for 2023/2024, with increases primarily for China. During this Kharif season, cotton cultivation in Gujarat has achieved a remarkable milestone, surpassing the records of the past eight years. In Rajkot, a major spot market, the price ended at 28970.35 Rupees gained by 0.07 percent. Technically market is under long liquidation as the market has witnessed a drop in open interest by -0.92% to settle at 324 while prices are down -140 rupees, now Cottoncandy is getting support at 59720 and below same could see a test of 59600 levels, and resistance is now likely to be seen at 59980, a move above could see prices testing 60120.
Trading Ideas:
* Cottoncandy trading range for the day is 59600-60120.
* Cotton dropped amid concerns over a slowdown in China.
* In Gujarat, Cotton sowing grows by nearly 5% against sown area of 2022
* Global cotton production will likely decline next season by three per cent
* In Rajkot, a major spot market, the price ended at 28970.35 Rupees gained by 0.07 percent.

Turmeric

Turmeric yesterday settled down by -2.27% at 15998 on profit booking after prices gained amid limited availability of quality produce in the market. Ongoing sowing and crop progress is major price driver for turmeric and forecast of drier weather in southern and central region has added worries to turmeric crops. Sowing activities almost completed in Maharashtra and likely to pick up in Andhra Pradesh and Tamil Nadu but erratic monsoon rainfall has impacted the sowing progress. The looming threat of El Nino casts a shadow over the upcoming turmeric crop. Meteorological predictions suggest the activation of El Nino in July, potentially resulting in reduced rainfall and drought conditions. Such conditions could particularly impact yields, like turmeric, that heavily rely on monsoon irrigation. Farmers shift in focus has led to expectations of a 20-25 percent decrease in turmeric sowing this year, notably in states like Maharashtra, Tamil Nadu, Andhra Pradesh, and Telangana. Turmeric exports during Apr-Jun 2023, rose by 16.87 percent at 57,775.30 tonnes as compared to 49,435.38 tonnes exported during Apr- Jun 2022. In Nizamabad, a major spot market, the price ended at 14276.45 Rupees gained by 1 percent. Technically market is under fresh selling as the market has witnessed a gain in open interest by 3.49% to settle at 16165 while prices are down -372 rupees, now Turmeric is getting support at 15680 and below same could see a test of 15360 levels, and resistance is now likely to be seen at 16520, a move above could see prices testing 17040.
Trading Ideas:
* Turmeric trading range for the day is 15360-17040.
* Turmeric dropped  on profit booking after prices gained amid limited availability of quality produce in the market.
* Sowing activities almost completed in Maharashtra and likely to pick up in Andhra Pradesh and Tamil Nadu
* In Jun 2023 around 18,356.57 tonnes was exported as against 19827.86 tonnes in May 2023 showing a drop of 7.42%.
* In Nizamabad, a major spot market, the price ended at 14276.45 Rupees gained by 1 percent.

Jeera

Jeera yesterday settled down by -0.79% at 59220 on profit booking after prices gained as supply is limited due to the rainy environment. However, upside seen limited in wake of improved global supply condition. Cheaper availability of Syria and jeera in global market will lead to fall in export demand from India in coming days. Drier weather condition in Gujarat will also lead to rise in arrivals that will cap the upwards move. China’s cumin imports and exports have caused temporary corrections in cumin prices, with a recent $200 decrease in the international market. The possibility of China purchasing Indian cumin in October-November before the arrival of new cumin adds further uncertainty to the market dynamics. 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-Jun 2023, rose by 13.16 percent at 53,399.65 tonnes as compared to 47,190.98 tonnes exported during Apr- Jun 2022. In Jun 2023 around 10,411.14 tonnes of jeera was exported as against 25,903.63 tonnes in May 2023 showing a drop of 59.81%. In Jun 2023 around 10,411.14 tonnes of jeera was exported as against 21,587.63 tonnes in Jun 2022 showing a drop of 51.78%. In Unjha, a major spot market, the price ended at 60487.25 Rupees dropped by -0.11 percent. Technically market is under long liquidation as the market has witnessed a drop in open interest by -2.18% to settle at 6456 while prices are down -470 rupees, now Jeera is getting support at 58490 and below same could see a test of 57760 levels, and resistance is now likely to be seen at 60110, a move above could see prices testing 61000.
Trading Ideas:
* Jeera trading range for the day is 57760-61000.
* Jeera dropped on profit booking after prices gained as supply is limited due to the rainy environment.
* However, upside seen limited in wake of improved global supply condition.
* Cheaper availability of Syria and jeera in global market will lead to fall in export demand from India in coming days.
* In Unjha, a major spot market, the price ended at 60487.25 Rupees dropped by -0.11 percent.

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