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Gold

Gold prices experienced a slight decline yesterday, settling at 71029, down by -0.24%, as investors deliberated over the potential monetary policy direction of the Federal Reserve in response to weaker-than-anticipated US PMI data. The service sector PMI dropped to 50.9, below expectations, signaling a five-month low in activity. Similarly, the manufacturing sector PMI slipped into contraction territory at 49.9, indicating a downturn from the previous month. Fed Chair Powell's remarks reflected cautious optimism regarding the economic outlook, suggesting that recent data may delay any potential interest rate cuts. Powell emphasized the need to let current policy measures continue their course, citing the strength of the labor market and progress on inflation as reasons to exercise patience. This stance implies that any rate adjustments in 2024 may occur later in the year, if deemed necessary. Technically, the gold market is experiencing long liquidation, with a decrease in open interest by -1.44% and a corresponding drop in prices by -168 rupees. Support for gold is identified at 70420, with a possible downside target of 69805, while resistance is anticipated at 71430, with a potential breakout leading to testing of 71825. Overall, gold prices are influenced by a combination of economic data and monetary policy outlook. While weaker PMI figures hint at potential economic challenges, Powell's comments suggest a measured approach to policy adjustments. Investors are likely to monitor incoming data closely for further insights into the Fed's stance, while technical indicators underscore the cautious sentiment prevailing in the gold market.

Trading Ideas:
* Gold trading range for the day is 69805-71825.
* Gold dropped as investors continued to weigh the potential monetary path by the Fed
* Fed’s Powell says rates to stay higher for longer
* S&P Global said its PMI for the service sector dropped to 50.9, down from March’s reading of 51.7.

Silver

Silver prices saw a modest uptick of 0.12%, closing at 80678, as investors regained confidence in riskier assets following a de-escalation of Middle East tensions. Iran's downplaying of the Israel attack helped ease geopolitical concerns, prompting a shift towards risk-on sentiment. However, the dollar strengthened to around six-month highs due to hawkish Fed commentary, dampening demand for dollar-denominated metals like silver. Fed officials reiterated a potential delay in easing monetary policy due to persistent inflationary pressures and robust economic data. Clarity on the Fed's rate trajectory is expected post the release of US GDP figures on Thursday and core PCE reading on Friday. Notably, recent remarks from senior Fed policymakers hinting at the possibility of policy remaining "restrictive" rather than moving "higher" for an extended period should be carefully considered, indicating a cautious approach towards policy normalization. The Silver Institute forecasts a 17% increase in the global silver deficit to 215.3 million troy ounces in 2024, driven by a 2% rise in demand primarily led by robust industrial consumption. Despite a 1% decline in total supply, last year's deficit of 184.3 million ounces remains significant. Industrial demand notably surged by 11%, while stocks held in commodity exchange depositories and London vaults decreased by 5% in 2023, equivalent to nearly 15 months of global supply. Technically, the market observed short covering, evidenced by a 12.62% drop in open interest to settle at 16636 contracts, coupled with a price increase of 99 rupees. Silver finds support at 79775, with potential testing of 78865 levels below that. Conversely, resistance is anticipated at 81180, with a move above likely leading to testing the 81675 mark.

Trading Ideas:
* Silver trading range for the day is 78865-81675.
* Silver steadied as investors returned to the riskier assets after Middle East tensions waned
* Hawkish Fed talk lifted the dollar to around six-month peaks, denting the demand for greenback-priced metals.
* Several Fed officials reconfirmed a possible delay in loosening cycle due to high inflation pressures and hot economic data.

Crude oil

Crude oil prices surged by 1.38% yesterday, closing at 6928, buoyed by a weaker dollar and increased investor risk appetite. The dollar's decline, coupled with positive economic indicators from Europe, fueled optimism in the oil market. Additionally, concerns over potential supply disruptions following EU discussions to expand sanctions on Iran contributed to the upward pressure on prices. Eurozone's robust economic performance, highlighted by the fastest expansion in business activity in nearly a year, underscored the optimistic sentiment. The composite PMI for April rose to 51.4, driven by a strong recovery in the service sector, indicating resilience in the region's economy. However, U.S. weekly imports of Mexican crude oil hit record lows for the second consecutive week, as Mexico's Pemex prioritized domestic refinery needs over exports. This trend may influence global supply dynamics, potentially impacting oil prices in the coming weeks. On the production front, the U.S. Energy Information Administration (EIA) forecasted a rise in oil output from top shale-producing regions in May, reaching the highest level in five months. This increase in production could alleviate supply concerns to some extent, balancing the market dynamics. From a technical perspective, the crude oil market witnessed fresh buying interest, with open interest rising by 9.26%. Prices surged by 94 rupees, indicating bullish momentum. Support for crude oil is identified at 6809, with a potential downside target of 6691, while resistance is anticipated at 6992, with a breakout potentially leading to testing of 7057.

Trading Ideas:
* Crudeoil trading range for the day is 6691-7057.
* Crude oil gains as the dollar slipped amid improvement in investors' risk appetite
* Business activity in the euro zone expanded at its fastest pace in nearly a year this month
* U.S. Senate to consider aid package with Iran oil sanctions

Natural gas

Natural gas prices saw a notable uptick of 0.99%, settling at 173.4, driven by forecasts of cooler weather and increased demand expected for the following week, alongside a decline in output and higher gas flows to LNG export facilities like Freeport LNG. Despite negative spot power and gas prices in certain regions and a substantial oversupply of gas in storage, prices surged. Analysts estimate that current gas stockpiles are approximately 35% above normal levels for this time of the year, reflecting the ongoing imbalance between supply and demand. US gas production has decreased by around 10% in 2024, as energy companies such as EQT and Chesapeake Energy scaled back drilling activities following a prolonged period of low prices earlier in the year. According to financial firm LSEG, gas output in the Lower 48 US states declined to 98.2 bcfd in April, down from 100.8 bcfd in March, and notably lower than the monthly record of 105.6 bcfd in December 2023. Daily output is projected to reach a preliminary three-month low of 95.9 bcfd, indicating a significant decrease in supply. Meteorologists anticipate colder-than-normal weather across the Lower 48 states until April 26, followed by a shift to warmer conditions from April 27 to May 4, potentially impacting gas demand patterns. Technically, the market witnessed fresh buying interest, with a notable increase in open interest by 21.09% to settle at 20569 contracts, coupled with a price increase of 1.7 rupees. Natural gas is currently supported at 170.3, with a potential test of 167.2 levels below that. Conversely, resistance is expected at 175.4, and a move above could lead to testing the 177.4 mark.

Trading Ideas:
* Naturalgas trading range for the day is 167.2-177.4.
* Natural gas prices increased due to cooler weather, increased demand, and rising gas flows to LNG export plants.
* US gas production has dropped by around 10% in 2024 due to delayed well completions and reduced drilling activities.
* Gas output in Lower 48 states fell to an average of 98.2 billion cubic feet per day in April, down from 100.8 bcfd in March.

Copper

Copper prices experienced a modest decline yesterday, settling down by -1.08% at 841.5, driven primarily by profit-taking from funds and hedging activities by producers following a speculative-driven rally. The market sentiment was influenced by comments from Federal Reserve officials, which tempered expectations of imminent rate cuts, alongside hotter-than-expected inflation data. In China, refined copper production surged by 7.9% in March compared to the previous year, reaching approximately 1.15 million metric tons. The country's National Bureau of Statistics reported an average daily output of 37,000 tons, indicating sustained production levels. Meanwhile, Chilean President Gabriel Boric expressed optimism about copper production at state-run miner Codelco, anticipating gradual growth to 1.7 million tons by 2030. He also predicted a rise in copper prices, fueled by flourishing activity in electric vehicles, power infrastructure, AI, and automation sectors. Trafigura echoed this sentiment, projecting an additional 10 million metric tons of copper consumption over the next decade, driven by increased demand in key sectors. Supply disruptions, such as the closure of First Quantum's Cobre mine in Panama last year, have further contributed to upward price momentum. However, technically, the copper market witnessed fresh selling pressure, with open interest rising by 15.25%. Despite this, prices experienced a marginal decline of -9.15 rupees. Support for copper is identified at 835.6, with a potential downside target of 829.8, while resistance is expected at 846.6, with a breakout possibly leading to testing of 851.8. Supply disruptions and robust consumption forecasts continue to underpin prices, while technical indicators suggest cautious market sentiment in the near term.

Trading Ideas:
* Copper trading range for the day is 829.8-851.8.
* Copper retreated on profit-taking by funds and hedging by producers.
* China's refined copper production in March rose 7.9% from the prior year
* Copper demand to boom as new technology drives power consumption, Trafigura says

Zinc

Zinc prices experienced a decline of -1.32%, settling at 247.05, driven by profit booking activities following earlier gains fueled by fund buying and concerns over supply dynamics. Data from China revealed an increase in refined zinc production, with output rising by 4.57% month-on-month to 525,500 mt in March. Despite this, the total output for January to March showed a year-on-year increase of 1.63%, slightly surpassing expectations. Positive signals emerged from China's factory activity, indicating robust expansion, alongside similar growth trends observed in the US manufacturing sector and Germany's industrial output, aligning with market expectations. Research agency BMI projects a continuation of refined zinc production growth in 2024, following a rebound in 2023. This follows widening annual production deficits in 2021 and 2022, driven by substantial growth in leading producer China. However, the agency forecasts an annual surplus of 192,000 tonnes in 2024, slightly lower than the 2023 surplus. Anticipated resumptions in production at Glencore’s Nordenham smelter in Germany and the completion of Norway’s Odda mine expansion are expected to bolster global zinc production further. Despite projections of a 2.6% rise in global zinc consumption in 2024, sluggish growth in the world economy is likely to outweigh this increase. Technically, the market observed fresh selling pressure, with open interest increasing by 20.12% to settle at 2848 contracts, while prices declined by -3.3 rupees. Support for Zinc is identified at 245.3, with a potential test of 243.4 levels below that. Conversely, resistance is anticipated at 248.9, and a move above could lead to testing the 250.6 mark.

Trading Ideas:
* Zinc trading range for the day is 243.4-250.6.
* Zinc dropped on profit booking after prices gained amid worries about supply
* Research agency BMI, said refined zinc production growth will continue to rebound in 2024.
* The anticipated resumption of Glencore’s Nordenham smelter and Norway’s Odda mine expansion later in the year is set to bolster global zinc production.

Aluminium

Aluminium prices took a notable dip yesterday, settling down by -3.02% at 236, driven by profit booking following recent gains spurred by supply concerns amid sanctions on Russian metals. Market dynamics were shaped by Washington and London's actions to restrict the acceptance of Russia-made aluminium, copper, and nickel by major exchanges like the LME and CME. The resulting reduction in available LME aluminium stocks to 171,200 tonnes marked the lowest level since August 2022, reflecting heightened supply worries. China's significant increase in imports of unwrought aluminium and products, jumping by 89.8% in March, highlighted robust demand in the world's largest aluminium consumer. This surge was supported by China's expanded manufacturing activity, signaling a recovery in demand for aluminium used extensively in various industries including automotive, construction, and packaging. However, despite increased demand, China also saw a rise in primary aluminium output by 7.4% in March, as higher metal prices drove industry profits. This rise in production added to the global supply pool, potentially offsetting some of the upward pressure on prices. Technically, the aluminium market experienced fresh selling, with open interest rising by 22.65%, while prices declined by -7.35 rupees. Support for aluminium is identified at 233.2, with a possible downside target of 230.2, while resistance is expected at 240.6, with a breakout potentially leading to testing of 245. While robust demand from China supported prices, increased domestic production added to market supply. Technical indicators suggest a cautious outlook, with potential price movements likely to be influenced by supply dynamics and demand trends moving forward.

Trading Ideas:
* Aluminium trading range for the day is 230.2-245.
* Aluminium dropped  on profit booking after prices gained on supply concerns.
* LME aluminium stocks reduced to 171,200 tonnes, representing the weakest level since August 2022.
* China's March aluminium imports jump 90% on – year

Cotton candy 

prices dipped by -0.68%, settling at 58540, mirroring trends in ICE prices due to factors such as increased certificated stocks, declining demand, and a growing world carryover. Despite a notable uptick in USDA weekly export sales, concerns regarding a potentially better crop in countries like Australia limited the upside for cotton prices. The International Cotton Advisory Committee (ICAC) projected increases in cotton-producing area, production, consumption, and trade for the upcoming season, 2024-25, signaling a potentially larger global supply. In India, the Cotton Association revised production estimates upwards for the current season, attributing it to increased crop production expectations. However, for MY 2024/25, cotton production is forecasted to decrease by two percent, with farmers expected to shift acreage to higher return crops. On the other hand, China's cotton imports for MY 2024/25 are anticipated to rise on the back of higher domestic and international demand for textile and apparel products. This follows a rebound in exports of textile and apparel products and increased demand for imported cotton. Technically, the cotton candy market witnessed long liquidation, with open interest remaining unchanged at 416 contracts, while prices declined by -400 rupees. Support for Cottoncandy is identified at 58160, with a potential test of 57780 levels below that. Resistance is expected at 59060, and a move above could lead to testing the 59580 mark. Market participants are closely monitoring global production trends, consumption patterns, and trade dynamics for further insights into cotton price movements.

Trading Ideas:
* Cottoncandy trading range for the day is 57780-59580.
* Cotton dropped tracking ICE prices due to an increase in certificated stocks and a growing world carryover.  
* The ICAC's projections for 2024-25 suggest that the cotton-producing area may increase by 3 per cent from the 2023-24 acreage
* For 2024/25 China’s cotton imports are forecast at 2.4 million metric tons
* In , a major spot market, the price ended at  Rupees dropped by  percent.

Turmeric

 prices surged by 5.29% yesterday, reaching 19556, driven by below-normal supplies and active festive demand. However, the upside appears limited as new arrivals are expected from the Marathwada region in Maharashtra, signaling a potential increase in supply. Reports indicated significant new crop arrivals in various markets, including Nanded, Nizamabad, and Erode, contributing to over 25% higher supplies compared to the previous week. Despite increased arrivals, turmeric production for 2023-24 is estimated to decline to 10.74 lakh tonnes, down from 11.30 lakh tonnes the previous year. Demand dynamics are also shifting, with demand destruction observed as prices surged, leading to a hand-to-mouth approach for many. However, turmeric-growing regions such as Sangli, Basmat, and Hingoli are experiencing good demand for quality produce, driven by expectations of an increase in sowing area. In terms of international trade, turmeric exports during Apr-Jan 2024 dropped by 3.52% compared to the same period in 2023. However, imports saw a more significant decline, dropping by 22.34% during the same period. Despite a slight increase in January 2024 exports compared to December 2023, there was a notable drop compared to January 2023, highlighting fluctuating demand trends. Technically, the turmeric market witnessed fresh buying interest, with open interest rising by 3.03% and prices increasing by 982 rupees. Support for turmeric is identified at 18840, with a potential downside target of 18124, while resistance is anticipated at 19980, with a breakout potentially leading to testing of 20404.

Trading Ideas:
* Turmeric trading range for the day is 18124-20404.
* Turmeric rose amid below normal supplies and active festive demand.
* However, upside seen limited as new arrivals are expected from the Marathwada region in Maharashtra.
* The Ministry of Agriculture first advance estimate for turmeric production in 2023-24 is estimated at 10.74 lakh tonnes
* In , a major spot market, the price ended at  Rupees dropped by  percent.

Jeera 

prices experienced a modest uptick of 0.82%, settling at 22225, driven by global buyers preferring Indian jeera amidst tightening global supplies. However, the upside was limited due to concerns about further pressure from increased arrivals in the market, particularly with 10,000 to 12,000 bags of jeera arriving daily in Rajkot Mandi, surpassing current demand levels. The surge in production, fueled by a 30-35% increase in sowing areas in key regions of Gujarat and Rajasthan, has led to a record production of cumin in Gujarat and a 53% increase in Rajasthan. This substantial increase in production has led to an oversupply situation, which could potentially impact prices in the coming months. Despite expectations of a significant increase in cumin exports in February 2024, export figures for Apr-Jan 2024 saw a decline of 25.33% compared to the previous year. Technically, the jeera market witnessed short covering, with a drop in open interest by -5.79% to settle at 2634 contracts, while prices increased by 180 rupees. Support for Jeera is identified at 21970, with a potential test of 21700 levels below that. Conversely, resistance is expected at 22440, and a move above could lead to testing the 22640 mark. In summary, while jeera prices saw a slight increase driven by global demand, concerns about oversupply and increased arrivals in the market have capped the upside potential. Additionally, the decline in export figures for the current marketing year highlights the challenges faced by the industry amidst fluctuating market dynamics. Traders are advised to monitor supply-demand trends and international market conditions for further insights into jeera price movements.

Trading Ideas:
* Jeera trading range for the day is 21700-22640.
* Jeera gains as global buyers preferred Indian jeera with tightening global supplies.
* There will be a huge increase in cumin exports, which will reach about 14-15 thousand tonnes in February 2024.
* New arrivals have started in Gujarat since last 20-25 days and new arrivals have started in Rajasthan also since last 15 days.
* In Jodhpur, a major spot market, the price ended at 24500 Rupees dropped by 0 percent.

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