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Gold

Gold prices eased by 0.37% to settle at Rs.76,260, as markets anticipated key U.S. economic data next week and analyzed the potential policy impacts of President-elect Donald Trump's administration in 2025. Fed Chair Jerome Powell's cautious stance on further rate cuts, following December's quarter-point reduction, kept investors wary. Upcoming reports, including the U.S. job openings data, ADP employment report, and the December FOMC meeting minutes, are expected to shape gold's near-term trajectory. In India, rising gold prices and a depreciating rupee widened discounts to $14 an ounce, the highest in three months, significantly reducing domestic demand. Gold imports in December are projected to drop sharply amid high prices and the absence of major festivals. Conversely, China's market flipped to premiums of $2-$5 per ounce as consumers began stocking up for the Lunar New Year, signaling stronger demand. Global central banks purchased 60 tons of gold in October, doubling the 12-month average, with the Reserve Bank of India (RBI) leading the charge, adding 27 tons. India’s year-to-date gold buying soared five-fold compared to 2023. Technically, the market is experiencing long liquidation, with a 0.73% decline in open interest to 12,686 contracts. Gold has immediate support at Rs.75,925, and a break below could test Rs.75,595. Resistance is pegged at Rs.76,680, with prices potentially testing Rs.77,105 above this level.

Trading Ideas:

* Gold trading range for the day is 75595-77105.

* Gold slipped as markets awaited the potential impact of President-elect Donald Trump's return to office on Fed’s 2025 outlook.

* China's net gold imports via Hong Kong in November more than doubled from October, marking the highest level in seven months

* Gold exports from Switzerland rose in November due to a jump in supplies to India and some revival of deliveries to China

Silver

Silver prices fell by 1.53% to settle at Rs.87,531, as signs of a hawkish Federal Reserve weighed on investor sentiment. Resilient U.S. labor market data and persistent inflation prompted FOMC members to project fewer rate cuts in 2025, reducing the appeal of non-yielding assets like silver. Despite 100 basis points in Fed rate cuts this year, a cautious outlook on additional reductions is keeping pressure on prices. The global silver market is expected to remain in deficit for the fourth consecutive year, with a 4% decline in the shortfall to 182 million ounces in 2024. Total demand is forecast to rise by 1% to 1.21 billion ounces, driven by record industrial use, including solar panels, EVs, and a recovery in jewelry consumption. However, physical investment demand is projected to drop by 16%. On the supply side, mine output is expected to grow by 1%, supported by increased production in Mexico, Chile, and the U.S., while recycling is anticipated to rise by 5%, driven by western silverware scrap. Technically, the market is witnessing fresh selling pressure with a 3.4% increase in open interest to 33,054 contracts. Silver has immediate support at Rs.86,660, and a break below this level could test Rs.85,795. Resistance is positioned at Rs.88,795, and prices could test Rs.90,065 if momentum strengthens above this threshold.

Trading Ideas:

* Silver trading range for the day is 85795-90065.

* Silver dropped as investors continued to heed signs of a hawkish Federal Reserve.

* Resilient labor market data per payroll counts and evidence of stubborn inflation drove FOMC members to project fewer rate cuts by the Fed in 2025.

* Markets anticipate signals regarding US economy under the incoming Trump administration and Fed’s interest rate outlook for 2025.

Crude oil

Crude oil prices climbed by 1.23% to settle at Rs.6,109, driven by a larger-than-expected drawdown in U.S. crude inventories. Data revealed a 4.3 million barrel drop in U.S. crude stocks for the week ending December 20th, exceeding market expectations of a 2 million barrel draw. Similarly, distillate inventories fell by 1.7 million barrels, surpassing the forecasted 700,000-barrel drop. However, gasoline stocks defied expectations with a rise of 1.6 million barrels. This marked the fifth consecutive weekly decline in crude oil inventories, challenging concerns of low demand leading to a surplus in the crude market. Optimism surrounding China's economic recovery added to bullish sentiment, as the World Bank raised its forecast for Chinese economic growth in 2024 and 2025. Chinese authorities also plan to issue special treasury bonds worth 3 trillion yuan to stimulate the economy. Conversely, global demand outlooks are under pressure, with the U.S. Energy Information Administration (EIA) lowering its 2024 oil demand growth forecast by 300,000 barrels per day (bpd) to 1.2 million bpd. Additionally, OPEC+ continues to revise its 2024 growth estimates downward. Technically, the market witnessed fresh buying as open interest surged by 17.81% to 10,808 contracts. Crude oil finds immediate support at Rs.6,046, with a break below this level likely testing Rs.5,984. On the upside, resistance is seen at Rs.6,150, and a move above could push prices towards Rs.6,192.

Trading Ideas:

* Crudeoil trading range for the day is 5984-6192.

* Crude oil prices rose buoyed by a larger-than-expected drawdown from U.S. crude inventories last week.

* Optimism over Chinese economic growth has also sparked hopes of higher demand next year from China.

* Stocks of crude oil in the United States fell by 4.3 million barrels

Natural gas

Natural gas prices surged by 17.66% to settle at Rs.334.5, driven by strong demand expectations amid depleting storage levels and geopolitical concerns. The latest data from the U.S. Energy Information Administration (EIA) showed a draw of 93 billion cubic feet (bcf) in gas storage for the week ending December 20, slightly below market expectations of a 99 bcf decline. Despite the draw, total storage stands at 3,529 bcf, remaining 0.4% above the same period last year and 4.9% higher than the five-year average. The most significant inventory reductions were recorded in colder regions like the Midwest (-47 bcf) and the East (-30.4 bcf). Support for prices also stemmed from forecasts of colder weather across the United States by mid-January, driving a significant increase in projected heating demand by 18 bcf. Additionally, geopolitical tensions, such as the end of the Ukraine-Russia gas transit agreement, have heightened concerns about Europe's gas supplies, boosting demand for U.S. liquefied natural gas (LNG). President-elect Trump's commitment to expanding LNG export permits further supports a bullish outlook as firms prioritize profitable exports over domestic sales. Technically, the market is under fresh buying pressure, with open interest spiking by 64.65% to 19,155 contracts. Immediate support lies at Rs.297.2, with a breach likely testing Rs.259.9. On the upside, resistance is pegged at Rs.363.6, and a move above this level could push prices toward Rs.392.7.

Trading Ideas:

* Naturalgas trading range for the day is 259.9-392.7.

* Natural gas rose due to depleting storage levels and the end of the Ukraine-Russia gas transit agreement.

* Support also seen as bets of stronger global LNG demand magnified the outlook of higher domestic consumption.

* Fresh forecasts of a cold front in the US halfway through January drove the industry to raise demand forecasts.

Copper

Copper prices declined by 0.5% to settle at Rs.802.45 as market participants awaited critical economic data from China, the largest consumer of base metals. Uncertainty surrounding U.S.-China trade relations under President-elect Trump added to the cautious sentiment. On the inventory front, copper stocks in Shanghai Futures Exchange warehouses increased by 4.7% in the week ending December 27. Meanwhile, global refined copper markets showed a surplus of 287,000 metric tons in the first 10 months of the year, compared to a marginal surplus of 9,000 metric tons in the same period last year, according to the International Copper Study Group (ICSG). On the supply side, Chile, the largest copper producer, reported October production at 127,900 metric tons through state-run miner Codelco. Global refined copper output for October reached 2.30 million metric tons, slightly below consumption at 2.34 million metric tons, resulting in a 41,000 metric ton deficit. China's copper imports rose in November to a one-year high of 528,000 tons, up 4.3% from October, as buyers took advantage of lower prices to replenish inventories. Technically, copper remains under selling pressure, with open interest rising by 4.72% to 8,733 contracts. Support is seen at Rs.798, and a break below could test Rs.793.6. Resistance is pegged at Rs.809.1, with a move above likely pushing prices toward Rs.815.8.

Trading Ideas:

* Copper trading range for the day is 793.6-815.8.

* Copper prices inched lower in holiday-thinned trading as market participants awaited economic data from China.

* Chinese policymakers hope policy support measures introduced late this year will bolster the property market.

* On a week-on-week basis, copper inventories in warehouses monitored by the Shanghai Futures Exchange rose 4.7% on Dec. 27.

Zinc

Zinc prices eased by 0.25%, settling at Rs.282.15 as domestic refined zinc production in China for December 2024 is anticipated to rise by over 20,000 metric tons month-on-month (MoM), marking a 5% increase. However, cumulative domestic refined zinc production in 2024 is projected to decline by more than 6% year-on-year (YoY). Despite lower-than-expected reductions at smelters in Henan, Gansu, Sichuan, and Inner Mongolia, production exceeded expectations in Qinghai, Xinjiang, Hunan, and other regions. The global zinc market deficit widened to 69,100 metric tons in October, compared to 47,000 metric tons in September, according to the International Lead and Zinc Study Group (ILZSG). Nonetheless, the first ten months of 2024 saw a global surplus of 19,000 metric tons, a significant drop from 356,000 metric tons during the same period in 2023. Demand prospects in China received support from the announcement of $411 billion in special treasury bonds for 2025, though weakening retail sales and a prolonged decline in home prices raised concerns. Technically, the zinc market remains under long liquidation, with open interest falling by 2.13% to 2,935 contracts. Support is seen at Rs.280.5, with further downside possible to Rs.278.8. Resistance is pegged at Rs.284.9, and a break above this level could push prices toward ?287.6.

Trading Ideas:

* Zinc trading range for the day is 278.8-287.6.

* Zinc dropped as China's refined zinc production in December will increase by over 5% MoM.

* Zinc inventories in warehouses monitored by the SHFE fell 24.67% from last Friday

* Data showed that retail sales growth in China slowed more than expected in November, reflecting weakening consumption.

Aluminium

Aluminium prices rose 0.23%, settling at Rs.241.95, supported by expectations of additional fiscal stimulus in China, the largest consumer. Reports suggest China might issue a record 3 trillion yuan ($411 billion) in special treasury bonds to bolster its slowing economy. Despite higher global primary aluminium output in November, which grew by 3% year-on-year to 6.04 million tonnes, supply constraints kept the downside limited. Orders to withdraw over 82,000 tons of aluminium stockpiles from LME warehouses, mainly in South Korea, further tightened availability. The global refined aluminium market faced a supply shortage of 40,300 tons in October. Cumulatively, refined aluminium production from January to October reached 59.652 million tonnes, while consumption stood at 59.985 million tonnes, resulting in a 332,600-tonne deficit. In China, primary aluminium production in November rose 3.6% year-on-year to 3.71 million metric tons, driven by capacity expansions that offset profit declines. Exports of unwrought aluminium and products from China surged by 17% year-on-year during the first ten months, totaling nearly 5.5 million tons. In October alone, exports reached 577,000 tons, a 31% year-on-year rise. Technically, the aluminium market showed fresh buying interest, with open interest increasing by 5.42% to 3,442 contracts. Support is seen at Rs.241.2, with further downside possible to Rs.240.4. Resistance is pegged at Rs.242.9, and a break above this level could test Rs.243.8.

Trading Ideas:

* Aluminium trading range for the day is 240.4-243.8.

* Aluminium gains on revived hopes for additional fiscal stimulus in China.

* China’s policymakers are planning to boost bond sales.

* Global refined aluminum market in short supply of 40,300 tons in October.

Cotton candy

Cotton candy prices edged up 0.04% to settle at Rs.54,160, driven by rising cotton yarn demand from garment industries and robust export orders. However, domestic cotton arrivals in the northern Indian states of Punjab, Haryana, and Rajasthan have declined by 43% year-on-year as of November 30, 2024, impacting the supply chain. Farmers are reportedly holding back kapas (unginned cotton) in anticipation of better prices, leading to raw material shortages for ginners and spinners. India’s cotton production for the 2024-25 season is projected at 302.25 lakh bales of 170 kg each, with imports expected to rise to 25 lakh bales, a significant increase from the previous season. By November 30, 9 lakh bales had already arrived at Indian ports. The closing stock for September 2025 is estimated at 26.44 lakh bales, lower than last year's 30.19 lakh bales. Globally, cotton production for 2024/25 is projected at 117.4 million bales, driven by higher output in India, Argentina, and Brazil. Consumption is estimated to rise by 570,000 bales, with increased demand in India, Pakistan, and Vietnam offsetting a decline in China. World ending stocks are raised by 267,000 bales, while beginning stocks are reduced by 428,000 bales. Technically, the cotton candy market saw short covering, with open interest dropping 0.27% to 367 contracts. Prices found support at Rs.53,260, with a potential downside to Rs.52,350. Resistance is likely at Rs.55,540, and a breakout above this level could test Rs.56,910, supported by demand recovery and mixed supply dynamics.

Trading Ideas:

* Cottoncandy trading range for the day is 52350-56910.

* Cotton gains as cotton yarn prices increased due to rising demand from garment industries and strong export orders.

* India's cotton production in 2024/25 is likely to fall by 7.4% from a year ago

* Cotton production is projected to increase in China, Brazil, and Argentina, more than offsetting reductions in the US and Spain – USDA

* In Rajkot, a major spot market, the price ended at 25631.55 Rupees gained by 0.1 percent.

Turmeric

Turmeric prices rose sharply by 3.03% to Rs.14,600, driven by robust buying due to reports of low supplies ahead of the new crop's arrival. Daily arrivals increased to 9,030 bags from 7,965 bags in the prior session, with notable activity in trading hubs like Erode and Hingoli. However, Hingoli markets were closed, and stock levels remain low, supporting firm prices in the short term. Prolonged vegetation growth due to extended rains may delay the arrival of fresh supplies despite improved crop acreage. India’s turmeric acreage is estimated to have increased to 3.75-4 lakh hectares this year, compared to 3-3.25 lakh hectares in 2023. Strong sowing activity, particularly in Erode and states like Maharashtra, Telangana, and Andhra Pradesh, suggests a potential bumper harvest. In Indonesia, accelerated harvesting due to dry weather has raised supply, which, coupled with low export demand, may limit further price hikes. On the trade front, turmeric exports rose by 6.57% during April-October 2024 to 108,879.96 tonnes compared to the same period in 2023. October exports stood at 15,938.21 tonnes, up 57.22% year-on-year. Imports also increased by 118.99% during the same period but saw a 23.53% year-on-year drop in October. Technically, the market witnessed fresh buying as open interest climbed 4.31% to 12,090 contracts. Turmeric prices have immediate support at Rs.14,338, with further downside potential to Rs.14,078. Resistance is seen at Rs.14,764, and a break above this level could lead to testing Rs.14,930.

Trading Ideas:

* Turmeric trading range for the day is 14078-14930.

* Turmeric gains on strong buying activity amid reports of low supplies till the arrival of new crop.

* However upside seen limited as turmeric crop is reported to be in good to excellent condition.

* In Indonesia, dry weather has accelerated harvesting, which is currently at peak levels.

* In Nizamabad, a major spot market, the price ended at 13655.7 Rupees dropped by -0.31 percent.

Jeera

Jeera prices increased by 1.27% to Rs.24,350 due to delays in sowing caused by unfavorable weather in key producing states Gujarat and Rajasthan. High temperatures have disrupted the sowing process and led to poor germination in many areas. Gujarat, the largest producer, has only sown jeera over 57,915 hectares till November 25, far below the 2.44 lakh hectares during the same period last year. The normal sowing area for jeera in Gujarat is over 3.81 lakh hectares, indicating only 15% coverage so far. The delay of 20-25 days could impact the crop cycle and yield. India's cumin production for 2023-24 reached 8.6 lakh tonnes, a significant increase from 5.77 lakh tonnes the previous year. However, the 2024-25 production is estimated to decline by 10% due to reduced cultivation, particularly in Rajasthan. Despite this, India remains a favored destination for cumin exports, as Indian cumin is priced competitively at $3,050 per tonne compared to Chinese cumin, which is $200-250 higher. Exports surged by 77.37% during April-October 2024 to 135,450.64 tonnes, with October exports rising 161.04% year-on-year. Strong international demand, especially from Europe and Middle Eastern tensions, has bolstered exports further. Technically, the market saw short covering with open interest dropping by 15.16% to 1,965 contracts while prices gained Rs.305. Jeera has immediate support at Rs.24,060, with further downside potential to Rs.23,750. Resistance is seen at Rs.24,540, and a move above this could push prices to Rs.24,710.

Trading Ideas:

* Jeera trading range for the day is 23750-24710.

* Jeera prices gained as sowing has been delayed

* Higher day temperatures in the past few weeks has impacted the seeding of jeera and has also led to poor germination in various places.

* In Gujarat, jeera sowing has taken place in only 57,915 hectares till November 25 during the rabi 2024-25 cropping season.

* In Unjha, a major spot market, the price ended at 24286.4 Rupees dropped by -0.07 percent.

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