Commodity Research Evening Track by Kotak Securities
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Gold futures near record highs ahead of US economic data releases
Comex Gold prices trading positive on Thursday climb above $2,700 an ounce ahead of release of important US economic data later in the day. Moreover, increasingly competitive in US presidential race has heightened demand for safe-haven assets like gold. The precious metal is up about 1% since the start of the week, with investors repositioning portfolios ahead of the US election that’s less than three weeks away. With both candidates posing different risks to the economy, gold will likely see further support — no matter whether Donald Trump or Kamala Harris win.
WTI Crude Oil prices rebounded after a four-day decline on Thursday, trading 0.50% higher at $70.50 a barrel. Market is concerns about a global oil glut despite potential risks to Middle Eastern production. Recent Israeli air strikes on Lebanon escalated tensions with Hezbollah, and an oil leak near a key Iranian terminal highlighted vulnerabilities in the country's export facilities. The global oil market is facing a potential supply glut as Americas now produce more oil than the Middle East, as the big three US oil companies ramp up output. OPEC+ next meets on Dec. 1 to consider restoring halted production slowing economic growth.
LME base metals experienced a decline on Thursday as investors expressed skepticism about the effectiveness of China's recent measures to revitalize its property market. Despite the government's announcement to expand a program supporting the completion of unfinished housing projects to 4 trillion yuan, concerns remain regarding the potential impact on construction activity and subsequent steel demand. The expansion, while significant, may not be sufficient to address the broader challenges facing the real estate sector and alleviate the downward pressure on base metals prices. LME Copper, aluminum and lead down by more than 0.50% today.
European natural gas edged higher by 1.2% on Thursday amid potential supply disruptions and volatile demand. Prices rose slightly on Thursday as colder temperatures expected to increase demand for heating fuel. While storage facilities are well-filled, a sudden spike in consumption or disruptions could strain the region's energy balance.
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