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Gold

Gold prices saw a modest increase of 0.28%, settling at 73,471, driven by expectations of upcoming interest rate cuts from the Federal Reserve. Investors are closely monitoring comments from Fed officials, especially Fed Chair Jerome Powell, who may indicate the start of rate cuts due to slowing inflation. The U.S. Producer Price Index (PPI) for June rose by 2.6% year-over-year, surpassing expectations and suggesting higher producer prices. However, recent data points to a cooling U.S. inflation trend, with the Consumer Price Index (CPI) unexpectedly decreasing by 0.1%. This has fueled hopes for monetary easing. China's central bank did not add to its gold reserves for the second month in a row, while gold imports to China via Hong Kong fell by 38% in April compared to March. The decline in imports to 34.6 metric tons marks a shift from the increased consumption seen in the first quarter. In India, gold demand remained weak, with dealers offering significant discounts to stimulate purchases. Indian gold has been sold at a discount for ten consecutive weeks due to tepid demand and lower duty on gold imported with platinum. Meanwhile, in China, premiums on gold ranged from $8 to $19 per ounce over international spot prices, with similar premiums observed in Singapore and Hong Kong. In Japan, gold was traded at a slight discount to a minor premium. Technically, the market is experiencing fresh buying interest, with open interest rising by 0.16% to 12,256. Gold prices are currently supported at 73,095, with a potential test of 72,715 if this level is breached. Resistance is expected at 73,795, and a move above this could see prices testing 74,115.

Trading Ideas:
* Gold trading range for the day is 72715-74115.
* Gold prices gained aided by hopes for interest rate cuts from Fed.
* US Producer Price Index for June comes out at 2.6% year-over-year
* According to the CME FedWatch Tool, markets now see a 94% chance of a U.S. rate cut in September.
 
 

Silver  

Silver prices fell by 0.58%, closing at 92,572, as the dollar strengthened and investors responded to weak economic data from China. The decline came despite U.S. consumer prices dropping for the first time in four years in June, which reinforced expectations of a Federal Reserve rate cut in September. While headline producer prices rose by 0.2% in June, indicating hotter-than-expected inflation, this was contrasted by a surprising drop in the CPI from the previous month. The mixed data trimmed the rally for Treasuries, as slowing inflation and a softening labor market supported the case for a rate cut by the Federal Reserve. Investors are also anticipating a key political meeting in China, where top officials are expected to discuss reforms and modernization plans. The silver market is looking forward to higher prices driven by a projected supply deficit in 2024, marking the fifth consecutive year of shortfall. In 2023, the silver supply fell short of demand by 142 million ounces, and this shortfall is expected to nearly double to 265 million ounces in 2024. Industrial demand for silver, largely from green energy, AI, and EV sectors, now constitutes 64% of global consumption. India's silver imports in the first four months of the year have already exceeded the total for all of 2023, driven by demand from the solar panel industry and investors betting on silver's outperformance versus gold. Technically, the market is under long liquidation with open interest dropping by 1.21% to settle at 22,710. Silver prices are finding support at 92,110, with a potential test of 91,650 if this level is breached. Resistance is expected at 93,245, and a move above this could see prices testing 93,920.

Trading Ideas:
* Silver trading range for the day is 91650-93920.
* Silver dropped as dollar firmed and investors reacted to weak economic data from China.
* Investors geared up for a key political meeting in China where top officials are expected to tackle reforms and modernization plans.
* Industrial demand for silver, driven by green energy, AI and EVs, now accounts for 64% of global silver consumption.
 
 
 
Crude oil  

Crude oil prices declined by 0.62%, settling at 6,847, as concerns over demand in China, the world's top importer, overshadowed support from strong demand elsewhere, OPEC+ supply constraints, and geopolitical tensions in the Middle East. The deceleration in U.S. consumer prices for June increased expectations for a Federal Reserve rate cut, with a 90% probability of a rate cut in September, up from 73%. Signs of strong summer demand have been providing some support to oil prices. China's crude oil imports in June fell 11% year-on-year to 46.45 million metric tons, or about 11.3 million barrels per day (bpd), as independent refiners reduced production due to weak profit margins and tepid fuel demand. Between January and May, China's gasoline demand fell nearly 2% year-on-year, and diesel demand dropped 14%.U.S. crude inventories fell by 3.4 million barrels to 445.1 million barrels for the week ending July 5, surpassing expectations for a 1.3 million-barrel draw. Crude stocks at the Cushing, Oklahoma delivery hub dropped by 702,000 barrels. Refinery crude runs increased by 317,000 bpd, and utilization rates rose by 1.9 percentage points. U.S. gasoline stocks fell by 2 million barrels to 229.7 million barrels, against expectations for a 0.6 million-barrel draw. Distillate stockpiles rose by 4.9 million barrels to 124.6 million barrels, versus expectations for a 0.8 million-barrel rise. Technically, the market is under fresh selling pressure, with open interest rising by 1.66% to settle at 5,320 as prices dropped by 43 rupees. Crude oil is finding support at 6,812, with a potential test of 6,776 if this level is breached. Resistance is likely at 6,889, and a move above this could see prices testing 6,930.

Trading Ideas:
* Crudeoil trading range for the day is 6776-6930.
* Crude oil dropped as downward pressure from concern about demand in China.
* Additionally, signs of strong summer demand limiting the downside.
* China June crude oil imports fall 11% on year, H1 imports down 2.3%
 
 
Natural gas

 
Natural gas prices dropped significantly by 5.46%, settling at 185.3, primarily due to forecasts of less hot weather and lower demand over the next two weeks than previously expected. This decline was further exacerbated by rising production, an oversupply of gas in storage, and the slow return of the Freeport LNG export plant in Texas after it shut down ahead of Hurricane Beryl. Additionally, speculators cut their net long futures and options positions for the third consecutive week, reaching the lowest levels since early May, as reported by the U.S. Commodity Futures Trading Commission's Commitments of Traders report. According to LSEG, gas output in the Lower 48 U.S. states rose to an average of 102.3 billion cubic feet per day (bcfd) in July, up from 100.2 bcfd in June and 99.5 bcfd in May, a 17-month low. U.S. gas output hit a record high of 105.5 bcfd in December 2023. Earlier in the year, several producers had cut output following a significant drop in futures prices to 3-1/2-year lows in February and March. Meteorologists projected that weather across the Lower 48 states would remain mostly hotter than normal through at least July 30, with some near-normal days expected from July 18-22. U.S. utilities added 65 billion cubic feet of gas into storage during the week ending July 5, 2024, exceeding market expectations of a 56 billion cubic feet increase. Technically, the market is under fresh selling pressure, with a 20.74% increase in open interest to settle at 40,150 as prices declined by 10.7 rupees. Natural gas is finding support at 183, with a potential test of 180.6 if this level is breached. Resistance is likely at 189.8, and a move above this could see prices testing 194.2.

Trading Ideas:
* Naturalgas trading range for the day is 180.6-194.2.
* Natural gas fell on forecasts for less hot weather and lower demand over the next two weeks.
* Speculators last week cut their net long positions for a third week in a row to their lowest since early May
* U.S. output hit a monthly record high of 105.5 bcfd in December 2023.
 
 
 
Copper

Copper prices declined by 1.48%, settling at 855.4, as disappointing economic data from China, the world's largest consumer of copper, weighed on market sentiment. China's economy grew less than expected in the second quarter, burdened by a persistent property downturn, weak domestic demand, and rising trade tensions with the West. Additionally, copper prices were pressured by a strong dollar, which gained on safe-haven bids following an assassination attempt on former U.S. President Donald Trump. London Metal Exchange data revealed that copper inventories rose to 206,778 tons last week, the highest level since October 2021, further dampening market sentiment. According to the International Copper Study Group (ICSG), the global refined copper market showed a 13,000 metric tons surplus in April, down from a 123,000 metric tons surplus in March. For the first four months of the year, the market saw a surplus of 299,000 metric tons, compared to 175,000 metric tons during the same period last year. In April, world refined copper output was 2.29 million metric tons, while consumption was 2.28 million metric tons. When adjusted for changes in Chinese bonded warehouse inventory, there was a 33,000 metric tons surplus in April, compared to a 136,000 metric tons surplus in March. Technically, the market is experiencing fresh selling pressure, with an 8.01% increase in open interest to settle at 7,484. Copper prices are finding support at 850.7, with a potential test of 845.8 if this level is breached. Resistance is likely at 864.4, and a move above this could see prices testing 873.2.

Trading Ideas:
* Copper trading range for the day is 845.8-873.2.
* Copper eased as disappointing economic numbers in China weighed on sentiment.
* China’s economy grew less than expected in the second quarter amid a persistent property downturn.
* LME copper inventories climbed to 206,778 tons last week, the highest since October 2021.
 
 
Zinc

Zinc prices increased by 0.29%, settling at 274.1, driven by optimism over potential demand boosts from China, ahead of the Communist Party's Third Plenum, which is expected to focus on economic policy and reforms. The anticipation of incoming stimulus from Beijing, particularly measures to support the country's debt-ridden property market, has fueled market optimism. China's refined zinc output in May 2024 was 536,200 metric tons, reflecting a 6.26% increase from the previous month. Despite the zinc ingot import window remaining closed, the Shanghai Bonded Zone saw an inventory rise to 15,000 metric tons, up 1,500 metric tons week-on-week, as overseas zinc ingots awaited the opening of the import window. MMG Ltd's two-month halt at its Dugald River zinc mine in Australia for repair work has added to the market's supply concerns, particularly in an already tight zinc concentrates market. Although MMG anticipates minimal impact on overall 2024 production, the mill stoppage could exacerbate existing shortages. Zinc inventories in London Metal Exchange (LME) warehouses rose 9% to their highest level in nearly three months, signaling a surplus in the market. In late February, LME zinc stocks reached their highest levels since May 2021 at 276,100 tons but had since declined by 13% until recently. Data from the International Lead and Zinc Study Group (ILZSG) indicated that the global zinc market surplus fell to 22,100 metric tons in April from 70,100 tons in March. Technically, the market is under fresh buying pressure, with a 3.62% increase in open interest, settling at 2,434 as prices rose by 0.8 rupees. Zinc is finding support at 272.4, with a potential test of 270.7 if this level is breached. Resistance is anticipated at 275.6, and a move above this level could see prices testing 277.1.

Trading Ideas:
* Zinc trading range for the day is 270.7-277.1.
* Zinc prices gains amid fuelling optimism over demand in China.
* China's refined zinc output in May 2024 up 6.26% MoM.
* China's MMG Ltd has halted operations at a mill at its Dugald River zinc mine in Australia for about two months of repair work.
 
 
 Aluminium

Aluminium prices fell by 0.81%, settling at 227.2, as concerns over weak demand prospects in China overshadowed the market. China's economic growth slowed to 4.7% in the second quarter, the slowest pace since Q1 2023, and below the 5.1% consensus forecast. This slow growth, coupled with weak lending numbers, highlighted the reduced demand in the country. Bank lending in China rose below expectations in June, further indicating weak demand, while total social financing, a key gauge of metals demand, also slowed. In contrast, China's primary aluminium production in June rose by 6.2% year-on-year, reaching 3.67 million metric tons, the highest single month of production on record. This increase was driven by higher profits for producers, who ramped up operations amid a surge in aluminium prices due to funds buying into the base metals sector. The northern region of Inner Mongolia added new capacity, and the southwestern province of Yunnan resumed most of its production due to sufficient hydropower supply during the summer rainy season. Producers enjoyed an average profit margin of 3,152 yuan ($434.09) per ton in June, 27.5% higher compared to the same period last year, according to research house Antaike. For the first six months of the year, China's aluminium production rose by 6.9% to 21.55 million metric tons compared to the same period last year. Technically, the aluminium market is under long liquidation, with a 1.12% drop in open interest, settling at 3,437 as prices declined by 1.85 rupees. Aluminium is currently finding support at 226.5, with a potential test of 225.8 if this level is breached. Resistance is expected at 228.4, and a move above this level could see prices testing 229.6.

Trading Ideas:
* Aluminium trading range for the day is 225.8-229.6.
* Aluminium eased as weak demand prospects in China were emphasised by slow economic growth
* China June aluminium output climbs on higher profits
* China's economy grew 4.7% in the second quarter, its slowest since the first quarter of 2023.
 

Cotton
 
Cotton prices declined by 0.33% to settle at 57,790 as expectations of favorable weather conditions in key growing regions are anticipated to boost supply. This downward trend is mitigated by delays in shipments from the US and Brazil, which has triggered increased demand for Indian cotton from neighboring mills. The firm trend in cottonseed prices is also providing some support to cotton prices, even as sowing for the kharif 2024 season has commenced in Karnataka, Telangana, and Andhra Pradesh with the onset of monsoon rains. The trade anticipates an increase in cotton acreage in Telangana, where some chili farmers are likely to switch to cotton due to the weak prices of chili. However, in North India, cotton acreage is expected to decline by about a quarter due to rising pest infestations and increasing labor costs. The 2024/25 U.S. cotton projections indicate higher beginning and ending stocks compared to last month. While production, domestic use, and exports remain unchanged, the season average upland farm price has decreased by 4 cents to 70 cents per pound due to a decline in new-crop cotton futures. Ending stocks are up by 400,000 bales to 4.1 million, or 28% of use. Globally, the 2024/25 cotton balance sheet shows increased beginning stocks, production, and consumption, with unchanged world trade. Consequently, world ending stocks are projected to be 480,000 bales higher at 83.5 million. Production forecasts are up by 90,000 bales due to higher area and yield in Burma. Consumption is up by 80,000 bales, with increases in Vietnam and Burma offsetting reductions elsewhere. In Rajkot, a major spot market, cotton prices ended at 27,619.55 Rupees, dropping by 0.48%. Technically, the market is under long liquidation, with open interest dropping by 2.17% to settle at 361, while prices decreased by 190 Rupees. Cotton is currently finding support at 57,730, with the potential to test 57,660 levels if this support is breached. Resistance is likely to be seen at 57,840, and a move above this level could see prices testing 57,880.

Trading Ideas:
* Cottoncandy trading range for the day is 57660-57880.
* Cotton dropped on expectations of good weather boosting supplies.
* China's agriculture ministry raised its forecast for cotton imports in the 2023/24 crop year by 200,000 metric tons
* The 2024/25 U.S. cotton projections show higher beginning and ending stocks compared to last month.
* In the global 2024/25 cotton balance sheet, beginning stocks, production and consumption are increased.
 
 
 
Turmeric

Turmeric prices settled down by 2.74% at 15,490 due to news of increased sowing. Despite this, upside potential remains limited as farmers are holding back stocks in anticipation of further price increases. With growers receiving fair prices, turmeric sowing is expected to occur extensively across all producing states this year. In particular, sowing on the Erode line is reported to be double that of last year, while in Maharashtra, Telangana, and Andhra Pradesh, a 30-35% increase in sowing is estimated compared to the previous year. Last year, turmeric was sown on about 3-3.25 lakh hectares nationwide, which is expected to increase to 3.75-4 lakh hectares this year. Last year’s lower sowing and unfavorable weather led to an estimated production of 45-50 lakh bags of turmeric in 2024, with an additional outstanding stock of 35-38 lakh bags. Despite increased sowing this season, the upcoming crop is expected to be around 70-75 lakh bags, with no outstanding stock, suggesting that availability will be less than consumption in 2025. In 2023, production was 80-85 lakh bags with an outstanding stock of 25-30 lakh bags. Turmeric exports during April-May 2024 dropped by 20.03% to 31,523.94 tonnes compared to 39,418.73 tonnes in the same period of 2023. In Nizamabad, a major spot market, the price ended at 16,551.7 Rupees, a drop of 0.81%. Technically, the market is under long liquidation as open interest dropped by 0.51% to settle at 15,988 while prices fell by 436 rupees. Turmeric is currently supported at 14,964, with a potential test of 14,438 levels if breached. Resistance is likely at 16,102, with prices possibly reaching 16,714 if it surpasses this level.

Trading Ideas:
* Turmeric trading range for the day is 14438-16714.
* Turmeric prices dropped amid news of increased sowing.
* Turmeric sowing on the Erode line is reported to be double as compared to last year.
* Turmeric was sown in about 3/3.25 lakh hectares in the country last year, which is estimated to increase to 3.75/4 lakh hectares this year.
* In Nizamabad, a major spot market, the price ended at 16551.7 Rupees dropped by -0.81 percent.
 
 
Jeera  

Jeera prices settled down by 0.69% at 26,730 due to expectations of higher production. However, the downside is limited by robust domestic and export demand alongside tight global supplies. Farmers holding back their stocks, anticipating better prices, also supported the market. This season, jeera production is projected to be 30% higher, reaching 8.5-9 lakh tonnes due to a significant increase in cultivation area. Gujarat saw a 104% increase in sowing area, while Rajasthan experienced a 16% rise. Global jeera production has notably increased, with China’s output soaring to 55-60 thousand tons from the previous 28-30 thousand tons. High prices last season encouraged increased production in Syria, Turkey, and Afghanistan, with new seeds expected in June and July. Turkey expects to produce 12-15 thousand tons, and Afghanistan's output could double, weather permitting. As new supplies enter the market, cumin prices are expected to decline. Additionally, reduced export trade in cumin contributes to the price drop, indicating a shift in global market dynamics. Pressure on prices at higher levels persists due to the expectation of higher production. The sowing area in Gujarat and Rajasthan increased significantly, leading to an estimated total production of 4.08 lakh tonnes in Gujarat, a new record. Rajasthan's cumin production increased by 53%, with overall production doubling compared to last year. Trade analysts estimate a significant increase in cumin exports, potentially reaching 14-15 thousand tonnes in February 2024. In Unjha, a major spot market, prices ended at 27,294.65 rupees, a 0.69% drop. Technically, the market is under long liquidation with a 1.84% drop in open interest to settle at 27,000 contracts while prices fell by 185 rupees. Jeera is currently supported at 26,500, with a potential test of 26,270 levels if breached. Resistance is likely at 26,980, with prices possibly reaching 27,230 if it surpasses this level.

Trading Ideas:
* Jeera trading range for the day is 26270-27230.
* Jeera dropped as the expectation of higher production weighed on the prices.
* China's cumin output soared to over 55-60 thousand tons from the previous 28-30 thousand tons.
* Turkey anticipates producing 12-15 thousand tons, while Afghanistan's output could double.
* In Unjha, a major spot market, the price ended at 27294.65 Rupees dropped by -0.69 percent.

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