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Gold

Gold prices surged by 0.95% to ?73,515, boosted by easing monetary policies from central banks and a weakening U.S. dollar. Expectations for more aggressive action by the Federal Reserve next week, including potential interest rate cuts, fueled the increase. Initial jobless claims in the U.S. rose, staying above previous averages, indicating a softening labor market, as weak August payroll data further supported. U.S. producer prices rose slightly more than anticipated in August due to higher service costs, but the overall trend suggests easing inflation pressures. Meanwhile, the European Central Bank (ECB) cut rates by 25 basis points, signaling confidence in a sustained decline in inflation. In Asian markets, retail gold demand remained muted due to elevated prices, forcing dealers in India and China to offer significant discounts. In India, the discount reached up to $22 per ounce, the highest in two months, while Chinese dealers offered discounts ranging from $8.6 to $10. Despite weak current demand, a price adjustment is expected by October-November as consumers adapt to higher rates. The World Gold Council (WGC) predicts a rebound in India's gold consumption in the second half of 2024, aided by a 9% reduction in import duty and favorable monsoon conditions. Technically, the market experienced fresh buying as open interest increased by 0.89% to 15,459, with prices rising ?691. Gold has support at ?73,195, and a drop below this could see it test ?72,870. Resistance is likely at ?73,730, with a move above potentially leading to ?73,940.

Trading Ideas:

* Gold trading range for the day is 72870-73940.
* Gold gains lifted by easier monetary policies from major central banks and a recently depreciating U.S. dollar.
* Initial jobless claims in the US rose from the previous week and remained above earlier averages, signaling a softening labor market.
* Retail buyers in key Asian hubs shied away from gold purchases due to soaring prices, forcing dealers to offer deep discounts.
 

Silver

Silver prices surged by 2.39% to ?89,180, driven by a weakening U.S. dollar and expectations of a potential interest rate cut during next week's Federal Reserve meeting. Speculation of an outsized rate cut further fueled the rally. Mixed signals from the latest U.S. Producer Price Index (PPI) data indicated softening headline inflation but sticky core PPI, adding uncertainty to the economic outlook. The Federal Open Market Committee (FOMC) meeting on September 17-18 is crucial, with markets anticipating a 25-basis point rate cut and more cuts likely by the year's end. Producer price growth in the U.S. slowed to 1.7% in August, down from 2.1% in July, providing some relief in inflation pressures but also signaling economic moderation. India's silver imports are expected to nearly double this year due to strong demand from the solar panel and electronics sectors, along with rising investor interest in silver as a better alternative to gold. In 2024, India's silver imports for the first half reached 4,554 tons, a significant jump from 560 tons in the previous year, supported by industrial buyers stockpiling due to concerns over rising prices and depleted inventories in 2023. Technically, the silver market experienced short covering as open interest dropped by 2.12% to 25,940, while prices rose by ?2,085. Silver is currently supported at ?87,745, with a break below that level potentially testing ?86,310. Resistance is seen at ?90,220, and a move above this could lead to prices testing ?91,260.

Trading Ideas:
* Silver trading range for the day is 86310-91260.
* Silver rose as the dollar weakened amid prospects of a U.S. interest rate cut next week
* Support also seen amid speculation about an outsized rate cut at next week's Federal Reserve policy meeting.
* The latest data showed U.S. producers saw mixed price pressures last month.
 

Crude oil

Crude oil prices fell by 0.67% to ?5,770, pressured by the resumption of production at several facilities in the U.S. Gulf of Mexico and concerns about weaker oil demand from China. The International Energy Agency (IEA) revised its 2024 global oil demand growth forecast downward by 70,000 barrels per day (bpd) to 900,000 bpd, primarily due to a slowdown in Chinese demand. China's oil demand is expected to grow by only 180,000 bpd in 2024, a significant drop as the country grapples with a broader economic slowdown and increasing adoption of electric vehicles. The IEA noted that global oil demand may plateau by the end of this decade as demand growth weakens in many key regions. In the U.S., crude oil inventories rose by 0.833 million barrels in the week ending September 6, below the expected 1 million rise. Gasoline stocks also increased by 2.311 million barrels, while distillate stockpiles rose by 2.308 million barrels, both exceeding market forecasts. Meanwhile, China's crude oil imports in August dropped 7% year-on-year to 49.10 million metric tons, though they were up from July's low of 42.34 million tons. Technically, the crude oil market is under long liquidation, with a significant drop in open interest by 29.52% to 10,000 contracts. Prices are down ?39, and crude oil has support at ?5,713. A break below this level could see a test of ?5,656. On the upside, resistance is likely at ?5,866, with a move above potentially pushing prices to ?5,962.

Trading Ideas:
* Crudeoil trading range for the day is 5656-5962.
* Crude oil dropped on reports crude oil production resumed in several facilities along the U.S. Gulf of Mexico.
* Concerns about the outlook for oil demand from China weighed as well on oil prices.
* IEA cuts 2024 oil demand growth forecast on China slowdown
 
Natural gas 

Natural gas prices surged by 4.43%, closing at ?200.3, driven by increasing seasonal demand, record LNG exports, and growing adoption of natural gas in China’s transportation sector. Despite record U.S. production levels, rising demand from power generation and industrial sectors is expected to tighten market conditions. While inventories remain slightly above average, potential supply disruptions from Gulf Coast storms and increased export volumes could strain stockpiles, adding more upward pressure to prices. U.S. gas production in the Lower 48 states averaged 102.1 billion cubic feet per day (bcfd) in September, down from 103.2 bcfd in August. Demand, including exports, is projected to rise from 99.6 bcfd this week to 100.1 bcfd next week, while supply is expected to decrease slightly. The U.S. Energy Information Administration (EIA) forecasts a slight decline in natural gas production to 103.4 bcfd in 2024, while domestic consumption is expected to hit a record 89.9 bcfd before easing in 2025. U.S. utilities added 40 billion cubic feet of gas to storage during the week ending September 6, below market expectations of a 49 bcf increase, bringing total stockpiles to 3,387 bcf, 198 bcf higher than last year and 296 bcf above the five-year average. Technically, the market is undergoing short covering, with open interest dropping by 7.27% to 30,861 contracts as prices gained ?8.5. Natural gas has support at ?191.7, and a decline below that level could lead to a test of ?183. Resistance is at ?205.1, and a break above that could push prices towards ?209.8.

Trading Ideas:
* Naturalgas trading range for the day is 187.2-205.8.
* Natural gas dropped on profit booking after prices gained supported by higher demand forecasts and a drop in output.
* Hurricane Francine prompted oil and gas producers to cut production.
* The U.S. EIA said utilities added 40 billion cubic feet (bcf) of gas into storage.
 

Copper

Copper prices rose by 0.44% to ?802.2, supported by hopes of economic stimulus in China, the largest consumer of copper. Chinese President Xi Jinping emphasized the need to meet the country’s annual economic goals, which spurred optimism about increased demand for copper. Additionally, copper inventories in Shanghai Futures Exchange warehouses fell by 13.9% from last Friday, marking a 45% decline over the past three months to 185,520 tons, the lowest since February. The import discount for copper in China also shifted to a premium, reaching $65 per ton, indicating stronger demand. On the global front, Macquarie expects the copper market to remain in surplus in 2025 and 2026, with prices forecasted to average $9,100 per ton this quarter before a recovery in Q4, assuming stockpiles decline. In Chile, state miner Codelco’s copper output fell by 10.7% year-on-year in July, while BHP's Escondida mine increased production by 29% in the same period. Despite these fluctuations, Chile’s copper commission Cochilco lowered its price forecast for copper in 2024 to $4.18 per pound, citing economic challenges in key consumer markets. Technically, the copper market is witnessing short covering, with open interest falling by 3.38% to 10,202 contracts, as prices increased by ?3.55. Copper has support at ?797.9, and a decline below this level could test ?793.6. On the upside, resistance is at ?805.9, and a move above that level could lead to prices testing ?809.6.

Trading Ideas:
* Copper trading range for the day is 793.6-809.6.
* Copper gains amid hopes that economic stimulus in China will boost demand.
* Chile state miner Codelco produced 111,400 metric tons of copper in July, down 10.7% from a year earlier.
* Copper inventories in warehouses monitored by the Shanghai Futures Exchange fell 13.9% from last Friday.
 
Zinc 

Zinc prices rose by 1.3% to ?267.9, buoyed by optimism surrounding potential stimulus measures in China after President Xi Jinping urged efforts to meet the country’s annual economic targets. The anticipation of more economic support lifted market sentiment, driving demand expectations higher. On the supply side, Swedish miner Boliden announced delays and increased costs for the expansion of its Odda zinc smelter in Norway, with full production now expected in 2025. This delay may contribute to tighter zinc supplies in the future. China's export growth moderated to 4.6% year-on-year in August 2024, reflecting the slow recovery of global demand. Meanwhile, zinc inventories in LME warehouses increased by 2.6% to 217,575 tonnes by the end of August. The global zinc market surplus narrowed to 8,700 metric tons in June, compared to 44,000 tons in May, indicating tightening supply conditions. However, China's refined zinc production fell sharply by 10.3% in July, with a total output of 489,600 metric tons, mainly due to disruptions caused by heavy rainfall and maintenance activities in key regions like Sichuan, Yunnan, and Henan. Technically, the zinc market is experiencing fresh buying interest, with open interest increasing by 8.92% to 2,319 contracts as prices climbed by ?3.45. Zinc has support at ?264.4, and a break below could lead to a test of ?260.9. On the upside, resistance is seen at ?270, and a move above that level could push prices towards ?272.1.

Trading Ideas:
* Zinc trading range for the day is 260.9-272.1.
* Zinc gains lifted by hopes of stimulus in China
* President Xi Jinping pushed for the country to achieve its annual economic target.
* Boliden said the expansion of its Odda zinc smelter in Norway will take longer than expected due to a delay in construction work.
 

 Aluminium

Aluminium prices increased by 1.71% to settle at ?228.8, driven by a seasonal demand recovery and inventory reductions. LME aluminium inventories have declined 22% over the past three months, reaching 877,950 tons, the lowest since May, indicating tightening supply. However, the market remains cautious due to concerns over global economic growth, especially as China’s manufacturing data hit a six-month low, suggesting weaker demand. On the supply side, China’s August aluminium output surged to a 21-year high, reaching 3.73 million metric tons, a 2.5% increase year-on-year. The rise in production was fueled by higher aluminium prices and stable profitability for smelters, particularly in Yunnan province, where ample hydropower enabled robust production. Global primary aluminium output also rose by 2.4% in July, with China leading the way, followed by increased output in the rest of Asia. Despite strong output figures, the gradual recovery in demand and shrinking inventories could provide further support for prices. Technically, the market is experiencing short covering, as open interest dropped by 13.9% to 2,887 contracts while prices climbed by ?3.85. Aluminium is currently finding support at ?226.3, with a potential test of ?223.9 if it breaks below that level. On the upside, resistance is seen at ?230.1, and a breach could lead prices to test ?231.5.

Trading Ideas:
* Aluminium trading range for the day is 223.9-231.5.
* Aluminium gains as demand side is entering the traditional peak season, consumption is gradually recovering
* Aluminium stocks were broadly unchanged, and on-warrant stocks pushed up to 345,300 tonnes in August
* Aluminium inventories in warehouses monitored by the Shanghai Futures Exchange fell 1.4% from last Friday
 
Cotton candy 

Cotton candy prices remained relatively stable, settling at ?58,600 with a marginal decline of 0.02%, as raw cotton arrivals began in Punjab's mandis. Despite the new arrivals, acreage for cotton in the current kharif season is down by 9% to 110.49 lakh hectares compared to 121.24 lakh hectares last year. On the export front, cotton exports for the 2023-24 season, which ends in September, are projected to rise sharply by 80% to 28 lakh bales due to increased demand from countries like Bangladesh and Vietnam. This is a significant jump from last year’s exports of 15.50 lakh bales. As of August, exports had already reached 27 lakh bales, while imports increased to 16.40 lakh bales, up from 12.50 lakh bales a year earlier. The Cotton Association of India (CAI) estimates closing stocks at 23.32 lakh bales for the year ending September 30, down from 28.90 lakh bales last year. Consumption is estimated at 317 lakh bales, with 291 lakh bales consumed by the end of August. Globally, the U.S. cotton balance sheet for 2024/25 reflects lower production and exports, with world production expected to drop by 1.2 million bales. Technically, the market is witnessing long liquidation as open interest dropped by 2.27% to 129 contracts. Prices are now finding support at ?58,600, and if this level is breached, it could test the same again. Resistance is pegged at ?58,600, with potential for prices to test the same level upward.

Trading Ideas:
* Cottoncandy trading range for the day is 58600-58600.
* Cotton prices ended with small losses as raw cotton has started arriving in mandis of Punjab.
* Cotton exports for the 2023-24 crop year or season ending September are estimated at about 80 per cent at 28 lakh bales
* The U.S. cotton balance sheet for 2024/25 shows lower production, exports, 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 surged by 3.8% to ?14,144, driven by tighter market supplies and increased buying from stockists. This price jump is also supported by reports of farmers holding back stocks, anticipating further price increases. However, the price surge might face limitations due to increased sowing activities. In Indonesia, dry weather has accelerated turmeric harvesting, although this has led to reduced production as many farmers are selling the crop at the wet stage due to attractive prices. Sowing of turmeric has notably increased this season, with reported figures indicating a doubling of sowing in the Erode region compared to last year and a 30-35% increase in Maharashtra, Telangana, and Andhra Pradesh. The total sown area is estimated to rise from 3.25 lakh hectares last year to 3.75-4 lakh hectares this year. Despite last year's lower sowing and unfavorable weather affecting production, the expected crop for 2024 is around 70-75 lakh bags, significantly higher than last year's 80-85 lakh bags. Turmeric exports saw a 19.52% drop for April-June 2024, totaling 46,498 tonnes compared to 57,775 tonnes in the same period of 2023. Imports, however, surged by 485.40% to 10,726 tonnes, compared to 1,832 tonnes in the previous year. Technically, the market is under short covering, with open interest dropping by 5.87% to 14,360 contracts. Prices have risen by ?518, finding support at ?13,682, with potential to test ?13,218. Resistance is currently seen at ?14,412, with a possibility of testing ?14,678 if surpassed.

Trading Ideas:
* Turmeric trading range for the day is 13218-14678.
* Turmeric gains amid tighter supplies in the market and emerging buying from stockists.
* Some support also seen as farmers are holding back stocks in anticipation of a further rise.
* In Indonesia, dry weather has accelerated harvesting, which is currently at peak levels.
* In Nizamabad, a major spot market, the price ended at 14484.15 Rupees gained by 0.84 percent.
 
Jeera

Jeera prices declined by 0.8% to ?25,490, primarily influenced by expectations of increased production. Despite this, prices remain supported by strong domestic and export demand, as well as tight global supplies. Farmers are also holding onto their stocks in anticipation of higher prices, which has provided additional support to the market. The sowing area for jeera has significantly increased this season, with Gujarat's area up by 104% and Rajasthan's by 16%. This surge in sowing is expected to boost production by around 30%, reaching an estimated 8.5-9 lakh tonnes. In Gujarat, the production is forecasted at a record 4.08 lakh tonnes, up from the previous record of 3.99 lakh tonnes in 2020-21. Globally, cumin production has surged, with China, Syria, Turkey, and Afghanistan contributing to higher outputs. Turkey is expected to produce 12-15 thousand tonnes, and Afghanistan's output could double, further exerting downward pressure on prices. Exports have seen a substantial increase, with a 46.56% rise from April to June 2024 compared to the same period in 2023. However, the monthly export figures in June showed a 29.12% drop from May, though they were still 60.13% higher than June 2023. Technically, the market is under long liquidation, with a 0.92% drop in open interest to 1,932 contracts. Prices have decreased by ?205, finding support at ?25,160, with potential to test ?24,830 if the support breaks. Resistance is seen at ?26,010, with a move above this level possibly pushing prices to ?26,530.

Trading Ideas:
* Jeera trading range for the day is 24830-26530.
* Jeera dropped as the expectation of higher production weighed on the prices.
* However downside seen limited amid robust domestic and export demand besides tight global supplies.
* Turkey anticipates producing 12-15 thousand tons, while Afghanistan's output could double.
* In Unjha, a major spot market, the price ended at 25465.9 Rupees dropped by -0.03 percent.

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