Commodity Research Evening Track by Kotak Securities
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Commodities trading mixed ahead of Fed, BOJ rate decisions
COMEX gold climbed marginally as investors anticipate central-bank events in the coming days, including a Federal Reserve policy meeting on Wednesday. Gold futures rose from a low of $2,377 per ounce and are track for a monthly gain. The Fed expected to cut interest rates in the coming months, and comments from Chair Jerome Powell's will be thoroughly analyzed after bank gathering.
As per WGC, India's gold demand in the June quarter fell 5% y/y to 149.7 tons from a year ago, but consumption in the second half of 2024 is set to improve due to a correction in local price following a steep reduction in import taxes, the World Gold Council (WGC). In the April-June quarter, jewellery demand fell 17%, which is offset by 46% rise in the investment demand during the quarter.
WTI Crude Oil steadied near a seven-week low near $76, as traders weighed the outlook for demand in top-importer China. Brent crude held near $80 a barrel after losing more than 3% over the previous two sessions. However, better-than-expected industrial profits in China fueled optimism that demand would rise, but the current dismal economic backdrop has investors concerned.
LME base metals continue to trade under pressure, as traders remained cautious ahead of the next Politburo meeting in late July. Market participants are waiting for an acknowledgement of economic difficulties and potential urgent measures to boost domestic demand. LME Copper trading down 0.73% below $8,970 per ton due to weak demand outlook, high stock levels at LME warehouses and record exports from China. LME Aluminium and Lead is trading lower by 0.84% and 1.26% respectively.
European natural gas prices remained stable as traders balanced the impact of increased worldwide rivalry for fuel against the region's plentiful supply as futures remained below €34 per megawatt-hour, after surging by over 4% the day before. Prices have increased since late last week, indicating that Europe is luring less liquefied natural gas to its shores. (Bloomberg)
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