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Gold

prices edged up by 0.27% to settle at 71,777, driven by a weaker U.S. dollar and growing expectations that the Federal Reserve will cut interest rates in September. The dollar hovered near a seven-month low as traders anticipated comments from Fed Chair Jerome Powell later this week, with many betting on rate cuts starting next month. The ongoing geopolitical tensions, particularly involving the Israel-Iran-Hamas conflict, continue to bolster gold's appeal as a safe-haven asset. Additionally, Swiss gold exports in July surged to their highest levels since April, driven by increased shipments to India and Britain, which offset reduced exports to China. In India, gold demand saw a revival due to the reduction of the state gold import tax to its lowest level in 11 years, despite a 4.23% decline in gold imports to $12.64 billion during April-July 2024-25. However, Indian gold dealers faced pressure to offer discounts as recent price hikes dampened retail purchases. Similar trends were observed in other key Asian markets, with discounts offered in China and Singapore, while Japan and Hong Kong saw prices ranging from par to small premiums. The World Gold Council (WGC) indicated that India's gold demand in the June quarter fell by 5% year-on-year but is expected to rebound in the second half of 2024 due to the recent reduction in import duties and favorable monsoon conditions. Technically, the gold market is experiencing fresh buying, with open interest rising by 0.71% to 17,709 contracts, as prices increased by 193 rupees. Gold is currently supported at 71,360, with potential downside testing at 70,950 levels. On the upside, resistance is expected at 72,225, and a move above this level could see prices testing 72,680.

Trading Ideas:
*Gold trading range for the day is 70950-72680.
*Gold rose amid a weaker dollar and bets Fed will cut interest rates in September.
*Holdings of SPDR Gold Trust, jumped to their highest in seven months at 859 tons.
*Swiss July gold exports rose to the highest since April.
 

Silver

prices rose by 0.46% to settle at ?84,730, driven by growing expectations that the US Federal Reserve may begin cutting interest rates in September. Several Fed officials have voiced concerns about rising risks to the labor market and the broader US economy, signaling a readiness to reduce borrowing costs as early as next month. The market is currently anticipating nearly 100 basis points of total easing by the Fed this year, though opinions remain split on whether the central bank will opt for a 20 or 50 basis point cut in September. Adding to the bullish sentiment for silver, Australian miner Perth Mint reported a significant surge in silver product sales, which jumped 91% month-on-month in July to 939,473 ounces, the highest level since February. The majority of these sales were shipped to the US, which remains the firm’s largest market. Meanwhile, Chicago Fed President Austan Goolsbee highlighted warning signs in the US labor market and leading economic indicators, including a rise in credit card delinquencies. Additionally, weaker-than-expected US housing starts in July have contributed to the cautious outlook. Investors are now keenly awaiting Fed Chair Jerome Powell’s speech at the Jackson Hole symposium and the latest FOMC minutes for further guidance on the Fed's monetary policy direction. U.S. consumer sentiment rose slightly in August, driven by developments in the presidential race, although inflation expectations remained steady. Technically, the silver market is experiencing short covering, with open interest dropping by 7.29% to settle at 21,970 contracts. Silver is currently finding support at ?84,110, with a potential test of ?83,485 if this level is breached. On the upside, resistance is expected at ?85,600, with a move above potentially testing ?86,465.

Trading Ideas:
*Silver trading range for the day is 83485-86465.
*Silver rose amid expectations that Fed will start cutting interest rates in September.
*A chorus of Fed officials warned about rising risks to the labor market and the broader economy in the US
*Markets are currently pricing in nearly 100 basis points in total Fed easing this year

Crude oil

prices declined by 0.58% to settle at 6,154, driven by increased production from Libya's Sharara oilfield, which has ramped up to approximately 85,000 barrels per day (bpd) to supply the Zawia oil refinery. This increase in production follows the lifting of a blockade that had previously caused a force majeure on oil exports from the 300,000-bpd field. Additionally, Saudi Arabia's crude oil exports decreased to 6.047 million bpd in June, down from 6.118 million bpd in May, according to data from the Joint Organizations Data Initiative (JODI). China's diesel demand also saw a significant drop of 11% year-over-year to 3.9 million bpd in June, marking the largest percentage decline since July 2021, as reported by the U.S. Energy Information Administration. In the U.S., crude oil production reached a record high of 13.4 million bpd in the week ending August 2, 2024, an increase of about 100,000 bpd, marking the first rise after reaching the previous record of 13.3 million bpd in early July. Meanwhile, U.S. crude oil inventories unexpectedly rose by 1.357 million barrels in the week ending August 9, 2024, breaking a six-week streak of declines, contrary to market expectations of a 2 million barrel decrease. However, stocks at the Cushing, Oklahoma delivery hub decreased significantly by 1.665 million barrels. Gasoline and distillate fuel inventories also saw substantial declines, surpassing forecasted reductions. Technically, the crude oil market is under fresh selling pressure, with open interest rising sharply by 21.91% to 8,312 contracts as prices fell by 36 rupees. Crude oil is currently supported at 6,085, with a potential downside towards 6,015 levels. On the upside, resistance is expected at 6,234, and a move above this level could see prices testing 6,313.

Trading Ideas:
*Crudeoil trading range for the day is 6015-6313.
*Crude oil dropped as production at Libya's Sharara oilfield has risen to about 85,000 bpd
*US crude oil inventories increased by 0.347 mln bbls, reversing the previous week's 5.205 mln bbls decline - API
*China’s July oil imports from top supplier Russia fall 7.4% from a year ago

Natural gas

prices declined by 1.29% to settle at ?184.1, driven by forecasts of milder weather over the next two weeks, which is expected to reduce the demand for natural gas by power generators to run air conditioners. Another key factor contributing to the downward pressure on gas prices is the oversupply in storage. Despite smaller-than-normal weekly builds in 13 of the past 14 weeks, gas inventories remain about 13% above the five-year average for this time of year. Data from LSEG indicated that natural gas output in the U.S. Lower 48 states has averaged 102.3 bcfd so far in August, down from 103.4 bcfd in July. Notably, daily output was expected to drop by 1.9 bcfd to a nine-week low of 100.0 bcfd, marking the largest daily decline since April. However, preliminary data often gets revised later in the day. With hotter weather anticipated, LSEG forecasted that average gas demand in the Lower 48, including exports, would rise from 103.7 bcfd this week to 104.3 bcfd next week, although these estimates are lower than earlier forecasts. The U.S. EIA has revised its projections, forecasting a larger decline in natural gas output for 2024 due to record-low prices earlier in the year that forced producers to cut back on production. Technically, the natural gas market is experiencing long liquidation, with open interest dropping by 3.78% to settle at 32,293 contracts. The next support level is at ?180.7, with a potential test of ?177.2 if this support is breached. On the upside, resistance is expected at ?189.3, with a move above potentially testing ?194.4.
 

Trading Ideas:
*Naturalgas trading range for the day is 177.2-194.4.
*Natural gas slid on forecasts for less hot weather over the next two weeks than previously expected.
*Another factor that has kept a lid on gas prices all year was the tremendous oversupply of gas in storage.
*Gas output in the U.S. Lower 48 states slid to an average of 102.3 bcfd so far in August, down from 103.4 bcfd in July.

Copper

prices declined by 0.81% to settle at 799.95 as the union at Chile's Escondida copper mine reached an agreement with BHP, averting the risk of a strike that could have disrupted global copper supplies. However, the downside was somewhat limited by signs of improving demand in China, the world's largest copper consumer, and hopes for U.S. interest rate cuts. In July, China exported 70,006 tons of refined copper, significantly lower than the record 157,751 tons exported in June, due to reduced profitability in exports. The London Metal Exchange (LME) cash copper contract traded at a discount of over $100 per ton to the three-month contract, signaling ample near-term supply. Chinese physical copper demand has shown slight improvement in recent weeks as prices dropped 4.4% in June and 3.9% in July. However, a strong rebound in consumption remains uncertain, given the country's slowing economic growth and ongoing challenges in the property sector. The global refined copper market experienced a surplus of 65,000 metric tons in May, up from an 11,000 metric tons surplus in April, according to the International Copper Study Group (ICSG). For the first five months of 2024, the market recorded a surplus of 416,000 metric tons, compared to 154,000 metric tons during the same period last year. Technically, the copper market is experiencing long liquidation, with open interest decreasing by 15.06% to 9,208 contracts as prices fell by 6.5 rupees. Copper is currently supported at 795.6, with further downside potential towards 791.3 levels. On the upside, resistance is expected at 806.2, and a move above this level could see prices testing 812.5.

Trading Ideas:
*Copper trading range for the day is 791.3-812.5.
*Copper dropped as Union at BHP's Escondida copper mine in Chile signs new deal, ending risk of strike.
*However, downside seen limited on signs of improving demand in China and U.S. rate cut hopes.
*China exported 70,006 tons of refined copper in July, less than half of a record high of 157,751 tons exported in June.

Zinc

prices rose by 0.23% to settle at ?264.6, driven by signs of improving demand in China, the top consumer, and a weakening dollar amid rising expectations of an imminent interest rate cut by the U.S. Federal Reserve. The sentiment was bolstered by a 9.3% decline in zinc inventories in Shanghai Futures Exchange-monitored warehouses, indicating tightening supply. Additionally, expectations of higher energy costs, which constitute about 50% of zinc production costs, provided further support to prices. China's recent inflation data, showing a move away from deflation, also contributed to the positive mood across equities and commodities markets. In the U.S., job growth slowed more than expected in July, and the unemployment rate increased to 4.3%, raising concerns about a potential economic slowdown. This data, along with weak manufacturing activity in China, initially triggered a selloff in risk assets but also fueled expectations of deeper interest rate cuts by the Federal Reserve, potentially starting in September. Adding to the supply concerns, MMG Ltd. halted operations at a mill at its Dugald River zinc mine in Australia for repairs, which is expected to last about two months. On the global front, the zinc market surplus decreased to 8,300 metric tons in May from 15,300 tons in April, according to the International Lead and Zinc Study Group (ILZSG). China's refined zinc production in July 2024 was significantly lower than expected, down 10.3% month-on-month and 11.15% year-on-year. Technically, the market is experiencing short covering, with open interest dropping by 9.03% to settle at 1,481 contracts. Zinc is currently supported at ?261.9, with potential testing of ?259 if this support is breached. On the upside, resistance is anticipated at ?267.5, with a move above potentially testing ?270.2.
 

Trading Ideas:
*Zinc trading range for the day is 259-270.2.
*Zinc gains as buying spurred by signs of improving demand in China and a sliding dollar.
*Zinc inventories in warehouses monitored by the Shanghai Futures Exchange fell 9.3% from last Friday.
*Support also seen as buying was triggered by expectations of higher energy costs

Aluminium

prices rose by 1.16% to settle at 226.55, driven by increased fund buying and a shortage of raw materials in China. The market sentiment has shifted positively, with some commodity trading advisor (CTA) funds beginning to build net-long positions in aluminium. This bullish trend is further supported by China's unexpected growth in aluminium imports, despite strong domestic production. In July, China exported 146,708 tons of alumina, marking a 9.6% year-on-year increase, with a significant portion directed to Russia. Additionally, China imported 129,898 tons of primary aluminium, an 11.5% increase from the previous year, indicating robust demand. The cost of raw materials for aluminium production has also risen, with China's alumina futures reaching a near three-month high due to increased consumption. Supply constraints have been exacerbated by production cuts at alumina refineries operated by Alcoa and Rio Tinto in Australia. Over 30% of alumina inventories were withdrawn from warehouses monitored by the Shanghai Futures Exchange (ShFE) in the past three weeks, driven by improved profitability in primary aluminium production. China's aluminium output in July reached its highest level in more than two decades, with 3.68 million metric tons produced, a 6% year-on-year increase. This surge in production is attributed to new projects in Inner Mongolia and continued strong production in other key regions. Globally, primary aluminium output in July rose by 2.4% year-on-year to 6.194 million metric tons, with China's contribution up by 2.5%. Technically, the aluminium market is experiencing short covering, with a 15.68% drop in open interest to 2,737 contracts as prices rose by 2.6 rupees. Aluminium is currently supported at 224.1, with potential downside towards 221.6 levels. On the upside, resistance is expected at 228.4, and a move above this level could see prices testing 230.2.
 

Trading Ideas:
*Aluminium trading range for the day is 221.6-230.2.
*Aluminium prices rallied on increased fund buying and a shortage of raw material in China.
*China exported 146,708 tons of alumina last month, up 9.6% from a year earlier, with 92.5% of the total flowing into Russia.
*Global aluminium output in July up 2.4% y/y, IAI says

Cotton

prices edged up by 0.09% to settle at 57,050, reflecting a tight supply situation and reduced acreage in the current Kharif cropping season. The cotton acreage has declined by around 9% to 110.49 lakh hectares compared to 121.24 lakh hectares in the same period last year. The Cotton Association of India (CAI) anticipates the total acreage for the year to be around 113 lakh hectares, down from 127 lakh hectares in the previous year. The shift in crops by farmers, driven by lower yields and high production costs, has contributed to this decline in acreage. The CAI also highlighted a tighter balance sheet for the upcoming season, primarily due to higher-than-expected exports to Bangladesh, which have surged from 15 lakh bales to 28 lakh bales. India's cotton production and consumption for 2023-24 have been consistent at around 325 lakh bales. However, with exports at 28 lakh bales and imports at 13 lakh bales, the gap of 15 lakh bales will reduce last year's stock. In terms of stock, spinning mills currently hold 25 lakh bales, ginners have around 15 lakh bales, and the Cotton Corporation of India has about 20 lakh bales. With another 10 lakh bales expected in August-September, the total available stock for consumption up to September 30 is 70 lakh bales. However, any delay in the new crop could tighten the supply for mills. Technically, the cotton market is experiencing short covering, with open interest remaining unchanged at 176 contracts while prices increased by 50 rupees. Cotton is currently supported at 57,000, with potential downside testing at 56,950 levels. On the upside, resistance is expected at 57,100, and a move above this level could see prices testing 57,150.

Trading Ideas:
*Cottoncandy trading range for the day is 56950-57150.
*Cotton prices gained as Cotton acreage trails by 9% at 110 lh
*CAI predicts acreage to be around 113 lh this year, up from 127 lh in the previous year.
*Global cotton production cut by 2.6 million bales; lower in US, India.
*In the global 2024/25 cotton balance sheet, beginning stocks, production and consumption are increased.

Turmeric

prices declined by 1.08% to settle at ?16,090, driven by limited demand as buyers remain cautious about making purchases. Export opportunities have been dampened by anticipated volatility in Bangladesh, further complicating the market outlook. Increased arrivals last week, as stockists offloaded their stocks in anticipation of a potential price drop due to weak demand, have also pressured prices. In Indonesia, dry weather has accelerated turmeric harvesting, currently at its peak, with many farmers selling their turmeric in the wet stage, leading to reduced production. The combination of increased acreage and subdued export demand may contribute to further price declines. However, the downside is somewhat limited by the fact that farmers are holding back stocks in anticipation of future price increases. Reports indicate that turmeric sowing in the Erode region has doubled compared to last year, while in Maharashtra, Telangana, and Andhra Pradesh, sowing is estimated to be 30-35% higher than the previous year. The overall turmeric sowing area is expected to increase from 3-3.25 lakh hectares last year to 3.75-4 lakh hectares this year. Despite the increase in sowing, the upcoming turmeric crop is projected to be around 70-75 lakh bags, with no outstanding stock, suggesting that availability may be lower than consumption in 2025. Turmeric exports during April-May 2024 dropped by 20.03% compared to the same period in 2023, while imports surged by 417.74%. Technically, the market is under long liquidation, with open interest dropping by 0.75% to settle at 20,450 contracts. Turmeric is currently finding support at ?15,962, with a potential test of ?15,836 if this support is breached. On the upside, resistance is expected at ?16,282, with a move above possibly testing ?16,476.

Trading Ideas:
*Turmeric trading range for the day is 15836-16476.
*Turmeric prices dropped as demand remains limited, as buyers are reluctant to make purchases.
*Pressure also seen amid news of increased sowing.
*In Indonesia, dry weather has accelerated harvesting, which is currently at peak levels.
*In Nizamabad, a major spot market, the price ended at 16000.4 Rupees dropped by -0.51 percent.

Jeera

prices declined by 1.7% to settle at 24,845, pressured by expectations of a higher production season. The anticipated increase in production, with estimates suggesting a 30% rise to 8.5-9 lakh tonnes, primarily driven by a substantial expansion in cultivation areas in Gujarat and Rajasthan, weighed heavily on prices. In Gujarat, the sowing area has surged by 104%, while Rajasthan saw a 16% increase. This significant boost in production is further supported by global trends, with China's cumin output more than doubling, and increases in Syria, Turkey, and Afghanistan also contributing to the potential oversupply.Despite the downward pressure, the decline in prices was somewhat cushioned by robust domestic and export demand, coupled with tight global supplies. Farmers are also holding back their stocks in anticipation of better prices, adding a layer of support to the market. However, the influx of new supplies from other cumin-producing regions and a reduction in export trade are contributing to a shift in global cumin market dynamics, leading to price softening. Technically, the jeera market is under fresh selling pressure, as evidenced by a 7.03% increase in open interest to 2,283 contracts while prices dropped by 430 rupees. Jeera is currently finding support at 24,460, with a further downside potential towards 24,070 levels. On the upside, resistance is expected at 25,290, and a move above this level could see prices testing 25,730. The market remains cautious as traders weigh the impact of increased production against ongoing strong demand.

Trading Ideas:
*Jeera trading range for the day is 24070-25730.
*Jeera dropped as the expectation of higher production weigh 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 25852.6 Rupees dropped by -0.37 percent.

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