IGI Logo

GLOBAL MARKET ROUND UP

Gold prices held steady around $4,050 an ounce on Wednesday, maintaining gains of more than 1% from the previous session after softer-than-expected U.S. inflation data reduced expectations of near-term Federal Reserve rate hikes. The annual U.S. inflation rate slowed to 3.5% in June from 4.2% in May, below market expectations of 3.8%, while consumer prices declined 0.4% month-on-month—the first monthly drop since 2020—largely due to lower energy costs

Despite the softer June inflation reading, the upside in gold may remain limited as markets increasingly expect inflation to rebound in July following the renewed escalation in the U.S.–Iran conflict, which has pushed crude oil prices higher. The prospect of renewed energy-driven inflation could reinforce expectations that the Federal Reserve will keep interest rates elevated for longer.

Despite the softer June inflation reading, the upside in gold may remain limited as markets increasingly expect inflation to rebound in July following the renewed escalation in the U.S.–Iran conflict, which has pushed crude oil prices higher. The prospect of renewed energy-driven inflation could reinforce expectations that the Federal Reserve will keep interest rates elevated for longer.

Meanwhile, Fed Chair Kevin Warsh reiterated the central bank's commitment to restoring price stability during his congressional testimony but stopped short of signaling a more aggressive policy stance. Markets continue to price in around a 50% probability of a September rate hike, with geopolitical tensions and higher oil prices keeping inflation risks in focus.

From a technical perspective, the broader trend remains "sell on rallies" as long as spot gold remains below $4,150. A sustained break above this level would be required to improve the near-term technical outlook.

Crude oil extended its rally on Wednesday, with WTI crude climbing toward $80 per barrel for a third consecutive session as renewed tensions between the U.S. and Iran intensified concerns over global oil supplies. Market sentiment remained supported after President Donald Trump warned of additional military strikes on Iran following the reinstatement of a U.S. blockade on Iranian vessels transiting the Strait of Hormuz. The renewed escalation has added a fresh geopolitical risk premium to oil prices, reversing earlier expectations of improving supply conditions following the interim U.S.–Iran peace agreement.

Natural gas futures continued to consolidate near the lower end of their recent trading range, hovering close to a two-month low as rising domestic production and expectations of softer demand weighed on sentiment. Prices also remained under pressure due to reduced LNG export flows, with scheduled maintenance at the Freeport LNG export facility in Texas temporarily limiting export demand.

Gold

• Trading Range: 139450 to 143500

• Intraday Trading Strategy: Sell Gold Mini Aug Fut at 142150-142175 SL 143050 Target 141380/140750

Silver

• Trading Range: 219780 to 231150

• Intraday Trading Strategy: Buy Silver Mini Aug Fut at 223050-223075 SL 221750 Target 225900/227080

Crude Oil

• Trading Range: 7375 to 7950

• Intraday Trading Strategy: Buy Crude Oil Jul Fut at 7575-7580 SL 7380 Target 7775/7900

Natural Gas

• Trading Range: 265 to 294

• Intraday Trading Strategy: Sell Natural Gas Jul Fut at 284-284.5 SL 289.8 Target 277/275

Copper

• Trading Range: 1304 to 1324

• Intraday Trading Strategy: Buy Copper Jul Fut at 1311-1312 SL 1304 Target 1319/1324

Zinc

• Trading Range: 372 to 384

• Intraday Trading Strategy: Buy Zinc Jul Fut at 375.0- 375.5 SL 372.8 Target 380.0/382.5

Please refer disclaimer at https://www.hdfcsec.com/article/disclaimer-1795

SEBI Registration number is INZ00017133