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Gold

Gold yesterday settled down by -1.34% at 55022 as dollar surged past 105 after Fed Chair Powell said interest rates are ‘likely to be higher’ than previously anticipated. Fed Chair said to the US Congress the Fed is prepared to increase the pace of rate hikes, if the totality of the data were to indicate that faster tightening is warranted. Powell also noted that the latest economic data have come in stronger than expected, which suggests that the ultimate level of interest rates is likely to be higher than previously anticipated. The Fed continues to anticipate that ongoing increases in the target range for the federal funds rate will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2% and that restoring price stability will likely require a restrictive stance of monetary policy for some time. Wholesale inventories in the United States fell by 0.4% from a month earlier to $929 billion in January 2023, in line with preliminary estimates and after a 0.1% increase in the prior month. Perth Mint's gold product sales in January rose by 6.2%. Monthly sales of gold coins and minted bars rose to 64,395 ounces last month, from 60,634 in December. Technically market is under long liquidation as the market has witnessed a drop in open interest by -2.08% to settle at 9968 while prices are down -747 rupees, now Gold is getting support at 54782 and below same could see a test of 54541 levels, and resistance is now likely to be seen at 55482, a move above could see prices testing 55941.

Trading Ideas:
* Gold trading range for the day is 54541-55941.
* Gold dropped as dollar surged past 105 after Fed Chair Powell said interest rates are ‘likely to be higher’ than previously anticipated.
* Fed Chair Powell says rates may need to go higher & faster.
* Fed policy rate futures price in a greater likelihood of a half-point rate hike in March.


Silver
Silver yesterday settled down by -3.33% at 62206 pressured by a rebound for the dollar as investors continued to assess the latest economic data and signals from Federal Reserve officials for hints on the potential peak of terminal level for the Fed funds rate. While some Fed members scaled back the pace of desired rate hikes in the coming meetings, hot economic data drove other members to call for fast increases to further curb inflationary pressure. Still, strong demand for solar power, reflected by the rally for solar panel equities, underpinned demand for silver as an electrical conductor. Tight supplies also limited the decline, with inventories at the LBMA and COMEX remaining at low levels. Perth Mint's silver product sales in January fell to their lowest in two years. Silver sales dropped 24.6% on a monthly basis to 1,233,344 ounces – its lowest since January 2021. Fed funds futures currently price in a 76 percent probability the Fed will raise rates by 25 basis points (bps) at its March 21 to 22 meeting. Market participants also look ahead to the release of U.S. February jobs report on Friday for additional clues regarding the extend and duration of the U.S. central bank's restrictive monetary policy. Technically market is under fresh selling as the market has witnessed a gain in open interest by 25.95% to settle at 17879 while prices are down -2143 rupees, now Silver is getting support at 61230 and below same could see a test of 60253 levels, and resistance is now likely to be seen at 64092, a move above could see prices testing 65977.

Trading Ideas:
* Silver trading range for the day is 60253-65977.
* Silver fell pressured by a rebound for the dollar as investors continued to assess the latest economic data
* Fed’s Daly said US rates need to stay higher for longer amid concerns about recent hotter-than-expected inflation data.
* Perth Mint's silver product sales in January fell to their lowest in two years.


Crude oil

Crude oil yesterday settled down by -2.27% at 6409 amid concerns over demand from China. Bearish sentiment surrounded a contraction in China's exports and imports in January and February, including crude imports. The decline came despite a lifting of COVID-19 restrictions, pointing to weakness in foreign demand. Chevron Chief Executive Mike Wirth said at a conference in Houston that the world is now more vulnerable to any unexpected supply disruption as a squeeze on Russian energy flows came at a time of limited oil inventories and supply swings. On the demand side, China's decision to set a lower-than-expected economic growth and customs data showing a decline in crude imports during January and February fuelled speculation that the reopening of the world's second-largest oil consumer could not spur demand as initially thought. China's crude oil imports fell 1.3% in the first two months of 2023 from a year earlier, data showed, but pointed to accelerating imports in February as a sign that fuel demand was rebounding after Beijing scrapped COVID-19 controls. Imports during January-February totalled 84.06 million tonnes, or about 10.40 million barrels per day (bpd), according to the General Administration of Customs. Technically market is under long liquidation as the market has witnessed a drop in open interest by -26.58% to settle at 6076 while prices are down -149 rupees, now Crude oil is getting support at 6344 and below same could see a test of 6280 levels, and resistance is now likely to be seen at 6521, a move above could see prices testing 6634.
 

Trading Ideas:
* Crude oil trading range for the day is 6280-6634.
* Crude oil dropped amid concerns over demand from China
* China's Jan – Feb crude oil imports down 1.3% but trending positive
* China's decision to set a lower-than-expected economic growth fuelled speculation that the reopening could not spur demand as initially thought.

Natural Gas

Nat.Gas yesterday settled up by 3.51% at 218.2 on forecasts for more cold weather over the next two weeks than previously expected and record gas flows to liquefied natural gas (LNG) export plants after Freeport LNG's plant in Texas exited an outage. That price rise came despite an increase in gas output so far this month and forecasts for less demand over the next two weeks than previously expected because most of the cold is not coming until mid March. The market has been extremely volatile in recent weeks as traders bet on the latest weather forecasts. Average gas output in the U.S. Lower 48 states rose to 98.4 bcfd so far in March, up from 98.2 bcfd in February. That compares with a monthly record of 99.9 bcfd in November 2022. In addition, extreme cold in early February and late December cut gas output by freezing oil and gas wells in several producing basins. Meteorologists forecast the weather in the Lower 48 states would remain mostly colder-than-normal through March 22 after some near- to warmer-than-normal days from March 7-10. With colder weather coming, Refinitiv forecast U.S. gas demand, including exports, would rise from 115.8 bcfd this week to 120.3 bcfd next week. Technically market is under short covering as the market has witnessed a drop in open interest by -10.85% to settle at 30089 while prices are up 7.4 rupees, now Natural gas is getting support at 213.6 and below same could see a test of 209.1 levels, and resistance is now likely to be seen at 221, a move above could see prices testing 223.9.
Trading Ideas:
* Natural gas trading range for the day is 209.1-223.9.
* Natural gas rose on forecasts for more cold weather over the next two weeks than previously expected and record gas flows to LNG export plants.
* That price rise came despite an increase in gas output so far this month
* The market has been extremely volatile in recent weeks as traders bet on the latest weather forecasts.


Copper

Copper yesterday settled down by -2.01% at 744.95 pressured by weak import data from leading metals consumer China and the potential resumption in supplies from a major mine in Peru. Premier Li Keqiang announced a 5% growth target for 2023 at the National People's Congress, the lowest in decades, after a 3% expansion in 2022, falling shy of a 5.5% goal. The Chinese authorities also called for implementing a "prudent monetary policy" in a "targeted" way. Meanwhile, fresh data showed exports and imports continued to fall in the first two months of 2023, adding further evidence of the challenges the economy faces. China's unwrought copper imports in the first two months of 2023 fell 9.3% from a year earlier, customs data showed, as higher global prices lowered buying appetite. Arrivals of unwrought copper and products into China, were 879,000 tonnes in January and February, down from 969,289 tonnes in the same period a year earlier, according to the General Administration of Customs. A surge in COVID-19 cases across the country after Beijing abruptly exited its zero-COVID policy in early December disrupted industrial activities, dampening copper demand. The metal is widely used in the power, construction and transportation sectors. Technically market is under fresh selling as the market has witnessed a gain in open interest by 9.48% to settle at 5266 while prices are down -15.25 rupees, now Copper is getting support at 740.2 and below same could see a test of 735.5 levels, and resistance is now likely to be seen at 753, a move above could see prices testing 761.1.
 

Trading Ideas:
* Copper trading range for the day is 735.5-761.1.
* Copper dropped pressured by weak import data from leading metals consumer China and the potential resumption in supplies from a major mine in Peru.
* Premier Li Keqiang announced a 5% growth target for 2023, the lowest in decades, after a 3% expansion in 2022, falling shy of a 5.5% goal.
* China Jan – Feb copper imports fall 9.3% to 879,000 tonnes



Zinc yesterday settled down by -2.07% at 262.35 as traders digested a gloomy economic outlook following the China’s reopening and dampened their expectations for significant stimulus this year. The retreat in prices has been driven by a strong dollar and the relatively slow revival of demand in China after it abandoned strict COVID-19 controls. On the supply side, power cuts in Yunnan have led to a larger production reduction at local smelters. Last week, companies that cut their production were Yunnan Yuntong Zinc, Chihong Zinc & Germanium (Huize county, Qujing city) and Luoping Zinc and Electricity. On the demand side, due to air pollution and other issues in north China, some factories slightly reduced production last week, but the galvanising enterprises maintained high operating rates. Zinc ingot social inventories across seven major markets in China totalled 184,900 mt as of March 6, up 1,500 mt from the previous week and up 800 mt over the weekend. In Shanghai, the arrivals during the weekend were scarce, and some cargoes heading for Zhejiang were still in transit. The active pick-up activities resulted in a slight decline in inventory in Shanghai. In Tianjin, the buyers were keen on picking up cargoes during the weekend thanks to low zinc prices last Friday. Technically market is under fresh selling as the market has witnessed a gain in open interest by 16.15% to settle at 3352 while prices are down -5.55 rupees, now Zinc is getting support at 261 and below same could see a test of 259.5 levels, and resistance is now likely to be seen at 265, a move above could see prices testing 267.5.
Trading Ideas:
# Zinc trading range for the day is 259.5-267.5.
# Zinc dropped as traders digested a gloomy economic outlook following the China’s reopening and dampened their expectations for significant stimulus this year.
# The zinc smelters are currently running normally, unaffected by the disruptions on raw material side.
# Due to air pollution in north China, some factories slightly reduced production last week, but the galvanising enterprises maintained high operating rates


Aluminium

Aluminium yesterday settled down by -1.01% at 206.65 as aluminium smelters in Yunnan complete production cuts, the market attention will focus more on the recovery of domestic consumption. It remains to be seen when the seasonal destocking will begin. Global aluminium producers have offered Japanese buyers premiums of $125-$145 per tonne for April-June primary metal shipments, up 45%-71% from this quarter. The offers, if agreed by buyers, would mark the first increase in six quarters and the highest level since the October-December quarter in 2022, reflecting a view from producers that demand from automakers is set to pick up. The Chinese government set its 2023 growth target for its economy at around 5%, lower than last year's target of 5.5%, according to a government work report released at the opening of the country's annual meeting of parliament on Sunday, as the world's second-biggest economy began to emerge from three years of severe COVID-19 restrictions. The Chinese economy grew 3% last year, significantly missing the 2022 target and marking one of the slowest rates of growth in almost half a century. China's trade surplus increased to USD 116.88 billion in January-February 2023 combined from USD 109.7 billion in the same period of a year earlier. Technically market is under fresh selling as the market has witnessed a gain in open interest by 3.62% to settle at 3836 while prices are down -2.1 rupees, now Aluminium is getting support at 205.9 and below same could see a test of 205 levels, and resistance is now likely to be seen at 207.8, a move above could see prices testing 208.8.
 

Trading Ideas:
* Aluminium trading range for the day is 205-208.8.
* Aluminum prices dropped as aluminium smelters in Yunnan complete production cuts
* Global aluminium producers offer Q2 premiums of $125 – $145/T
* China sets 2023 GDP growth target of around 5%


Turmeric

Turmeric yesterday settled down by -0.86% at 6910 as turmeric harvesting has started in the key growing regions and farmers and stockists are releasing their stocks, in the fear of further decline in prices. In AP (Nizamabad) Turmeric market around 5,000-7,000 bags are arriving on an average daily basis. In the Erode spot market 400-600 bags are reported on a daily basis, In the Sangli district it is around 3500-7000 bags. Coupled with weak demand in the export and domestic market prices are trading at lower levels (in the current season). Turmeric exports during Apr-Dec 2022 has rose by 6.81 percent at 1,24,008.08 tonnes as compared to 1,16,100.75 tonnes exported during Apr- Dec 2021. In the month of December 2022 around 12,039.57 tonnes turmeric was exported as against 12,398.63 tonnes in November 2022 showing a drop of 2.90%. In the month of December 2022 around 12,039.57 tonnes of turmeric was exported as against 14,218.72 tonnes in December 2021 showing a rise of 15.83%. 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 6924.4 Rupees dropped -65.1 Rupees.Technically market is under fresh selling as the market has witnessed a gain in open interest by 0.68% to settle at 11915 while prices are down -60 rupees, now Turmeric is getting support at 6866 and below same could see a test of 6824 levels, and resistance is now likely to be seen at 6968, a move above could see prices testing 7028.

Trading Ideas:
* Turmeric trading range for the day is 6824-7028.
* Turmeric prices dropped as turmeric harvesting has started in the key growing regions
* Pressure also seen as farmers and stockists are releasing their stocks, in the fear of further decline in prices
* The crop is good this season despite some projection of a lower crop.
* In Nizamabad, a major spot market in AP, the price ended at 6924.4 Rupees dropped -65.1 Rupees.

Jeera

Jeera yesterday settled down by -0.85% at 30310 as harvesting have started in the Cumin growing regions and it is in process which may get complete by the end of this month. As a result, new crop arrivals likely to enter in bulk quantities from last week of Feb or first week of March in the spot market. Some damage has been reported in Gujarat, Banaskantha region due to very low temperature and frost impact. However, overall crop condition is quite good in Gujarat area as compared to Rajasthan key growing regions. Early sown crop has harvested and its arrivals in the Unjha benchmark are reported at 150-250 bags (15%-20% moisture content) on an average daily basis. Jeera exports during Apr-Dec 2022 has dropped by 15.91 percent at 146,065.90 tonnes as compared to 173,703.10 tonnes exported during Apr- Dec 2021. In the month of December 2022 around 12,798.15 tonnes jeera was exported as against 11,235.11 tonnes in November 2022 showing a rise of 13.91%. In the month of December 2022 around 12,798.15 tonnes of jeera was exported as against 12,385.20 tonnes in December 2021 showing a rise of 3.33%. 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 -364.65 Rupees to end at 30110.95 Rupees per 100 kg.Technically market is under fresh selling as the market has witnessed a gain in open interest by 3.65% to settle at 3660 while prices are down -260 rupees, now Jeera is getting support at 30020 and below same could see a test of 29735 levels, and resistance is now likely to be seen at 30570, a move above could see prices testing 30835.

Trading Ideas:
* Jeera trading range for the day is 29735-30835.
* Jeera prices dropped as harvesting have started in the Cumin growing regions and it is in process which may get complete by the end of this month
* Global production will be higher at 4.35 lt against 4.08 lt.
* But net supplies from India are projected 7 per cent lower.
* In Unjha, a key spot market in Gujarat, jeera edged down by -364.65 Rupees to end at 30110.95 Rupees per 100 kg.
 

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