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Gold

Gold prices declined by -0.28% yesterday, settling at ?73,946, as sticky US inflation and strong labor market data weighed on the metal. Comments from Federal Reserve Chairman Jerome Powell further dampened sentiment, as he noted the US economy was performing “remarkably well,” reducing the need for aggressive rate cuts. Federal Reserve Bank of Boston President Susan Collins also indicated that a December rate cut is possible but contingent on forthcoming data. Political developments in the US added pressure, with Republicans securing a majority in the House of Representatives, signaling potential fiscal policy stability. In the physical market, gold demand in India slowed after robust festival sales, as volatility discouraged buyers. Indian dealers charged premiums of up to $3 an ounce over official prices, compared to $1 last week. In contrast, Chinese dealers widened discounts to $15-$17 an ounce from last week's $11-$14 amid the central bank's sixth consecutive month of abstention from gold purchases. In Singapore, premiums ranged from $0.2 to $2.20, while Japan maintained par to a $1 premium. The World Gold Council (WGC) reported steady global gold demand (excluding OTC trading) at 1,176.5 metric tons in Q3 2024, with higher investment offsetting reduced jewelry consumption. Total gold demand, including OTC flows, rose 5% to 1,313 tons, a Q3 record. ETFs recorded inflows of 95 tons, while bar and coin investment fell 9%. On the supply side, mine production rose 6% and recycling increased by 11%. Gold is under fresh selling pressure, with open interest increasing by 2.21% to 10,758 contracts. Immediate support lies at ?73,795, with further downside to ?73,645. Resistance is at ?74,190, with potential testing of ?74,435 on upward movement.
 

Trading Ideas:
* Gold trading range for the day is 73645-74435.
* Gold prices dropped amid sticky US inflation and positive labor market data.
* The US economy is in “remarkably good” shape, according to Fed Chair Powell.
* Boston Fed president says December rate cut not a 'done deal'

Silver

Silver settled down by -0.51% at ?88,421, pressured by a stronger dollar and rising U.S. Treasury yields following Donald Trump's election victory. Comments from Fed Powell further dampened rate cut expectations, as Powell highlighted the need for a cautious approach to rate adjustments amid persistent inflationary pressures. Supporting the dollar, U.S. retail sales rose by 0.4% in October, exceeding market expectations of 0.3%, while export prices saw their largest monthly increase since August 2023 at 0.8%. The NY Empire State Manufacturing Index surged to 31.2 in November, its highest level since December 2021, reflecting strong improvements in orders and shipments. On the supply-demand side, the global silver deficit is projected to decline by 4% to 182 million ounces in 2024, with supply rising 2% and demand growing 1%. Record industrial demand, driven by applications in electronics, electric vehicles, and solar panels, along with recovering jewelry consumption, is expected to lift total demand to 1.21 billion ounces. However, physical investment is forecast to drop by 16%. Mine supply is set to rise by 1%, supported by increased production in Mexico, Chile, and the U.S., while recycling is anticipated to grow by 5% due to increased silverware scrap. India’s silver imports nearly doubled this year, fueled by strong demand from solar panel manufacturers, electronics industries, and investors seeking better returns than gold. Imports reached 4,554 metric tons in the first half of 2024, compared to 560 tons a year earlier. Technically, silver remains under selling pressure as open interest increased by 0.24% to 22,653 contracts, with prices down by ?449. Support is seen at ?87,935, and a break below could test ?87,445. Resistance is at ?89,290, with a move above potentially targeting ?90,155.
 

Trading Ideas:
* Silver trading range for the day is 87445-90155.
* Silver prices dropped amid by a stronger dollar and rising yields.
* Comments by Federal Reserve Chair Jerome Powell poured cold water on rate cut optimism.
* Retail sales in the US increased 0.4% month-over-month in October 2024, following an upwardly revised 0.8% gain in September.

Crude oil

Crude oil prices fell by -1.66% yesterday, settling at ?5,679, amid growing concerns over a potential shift to a global oil market surplus. The International Energy Agency (IEA) projected an oil surplus for 2025, driven by slowing demand growth in China and increased global production. The situation could worsen if OPEC+ restores previously curtailed production levels. Adding pressure, the US dollar surged to a 2-year high, reducing the appeal of dollar-denominated commodities like crude oil. On the inventory front, the US Energy Information Administration (EIA) reported a larger-than-expected crude inventory build of 2.1 million barrels last week, exceeding forecasts of 1.9 million barrels. However, gasoline stockpiles saw a sharp decline of 4.4 million barrels, bringing them to a decade low for this time of year. Distillate stocks, including diesel and heating oil, also dropped by 1.394 million barrels against an expected rise of 0.7 million barrels. The EIA revised its global oil demand growth forecast downward to 1.2 million barrels per day (bpd) for 2025, bringing the total to 104.3 million bpd, 300,000 bpd below prior forecasts. For 2024, demand is expected to reach 103.1 million bpd, a slight reduction from earlier estimates. Meanwhile, US oil output for 2025 is forecast at 13.54 million bpd, down from a prior estimate of 13.67 million bpd, reflecting moderated production growth expectations. Crude oil is under fresh selling pressure, with open interest rising by 13.76% to 10,755 contracts. Immediate support is seen at ?5,632, with a potential test of ?5,585 if prices decline further. Resistance is expected at ?5,766, with an upward move possibly testing ?5,853. Bearish sentiment prevails amid surplus concerns and weaker demand forecasts.
 

Trading Ideas:
* Crudeoil trading range for the day is 5585-5853.
* Crude oil fell driven by concerns that the global oil market could shift into oversupply.
* The International Energy Agency projected an oil surplus for next year, citing slowing demand growth in China.
* Crude inventories rose by 2.1 million barrels last week, exceeding expectations of a 1.9 million-barrel rise - EIA

Natural gas

Natural gas settled down by -0.75% at ?237.5, pressured by increased daily production and higher-than-expected storage builds. The latest federal report revealed utilities added 42 billion cubic feet (bcf) of gas to storage for the week ending November 8, 2024, aligning with market expectations but marking the fourth consecutive week of larger-than-usual injections—the first such streak since October 2022. Despite this, losses were limited by forecasts of colder weather, which is expected to drive up heating demand in the coming weeks. Average gas output in the Lower 48 U.S. states stood at 100.2 billion cubic feet per day (bcfd) in November, slightly down from 101.3 bcfd in October. Daily output, however, rose to a six-day high of 100.5 bcfd on Thursday, recovering from a nine-month low of 98.4 bcfd earlier in the week. Meanwhile, gas flowing to U.S. LNG export facilities reached a nine-month high of 13.3 bcfd in November, reflecting robust export demand. The U.S. Energy Information Administration (EIA) projects dry gas production to decline from a record 103.8 bcfd in 2023 to 103.3 bcfd in 2024 due to reduced drilling activity. In contrast, domestic consumption is forecasted to rise to a record 90.0 bcfd in 2024, supported by colder weather patterns and increasing export demand. Technically, the market is under long liquidation, with a 5.7% drop in open interest to settle at 15,847 contracts while prices declined by ?1.8. Natural gas finds support at ?230.2, with a breach potentially testing ?222.8. Resistance is seen at ?242, and a move above this level could push prices to ?246.4. Colder weather and LNG export strength will be key factors influencing further price movements.
 

Trading Ideas:
* Naturalgas trading range for the day is 222.8-246.4.
* Natural gas fell on an increase in daily output and a federal report showing utilities added more gas to storage.
* EIA said utilities added bigger-than-normal 42 billion cubic feet (bcf) of gas into storage.
* Daily feedgas to US LNG export plants on track to hit nine-month high


Copper

Copper prices declined by -0.27% yesterday, settling at ?795.15, as a surging U.S. dollar and mixed demand signals from China weighed on market sentiment. The cancellation of export tax rebates on Chinese copper products is expected to reduce exports, potentially tightening global supply. Additionally, copper inventories in Shanghai Futures Exchange-monitored warehouses fell by 6.6%, indicating strong demand. Chinese copper smelters face challenges due to a severe shortage of raw materials, which may prompt further production cuts or extended maintenance periods. Global mine disruptions and aggressive capacity expansion by smelters have led to intense competition for copper concentrates, driving treatment charges to record lows. Production data showed mixed results: Chile’s state-run copper producer increased output by 5.2% year-on-year in September, while production at BHP's Escondida mine declined by 5.4%. Codelco continues to struggle with output due to operational challenges. On the global front, the refined copper market posted a surplus of 54,000 metric tons in August, narrowing from July's 73,000 metric tons. China's copper imports showed resilience, rising by 1.1% year-on-year in October to 506,000 metric tons, driven by seasonal demand and improved consumption prospects. For the first ten months of 2024, imports grew by 2.4% to 4.6 million tons. The Yangshan premium peaked at $69 per ton in October, reflecting strong import appetite before easing to $48. The copper market is experiencing long liquidation, with open interest dropping by -3.13% to 7,573 contracts. Immediate support is at ?788.7, with further downside testing at ?782.2. Resistance is at ?807.5, and a move above could test ?819.8. Market dynamics remain influenced by global supply disruptions, China’s demand trends, and dollar strength.
 

Trading Ideas:
* Copper trading range for the day is 782.2-819.8.
* Copper dropped amid a surging U.S. dollar and investors assessed the demand outlook in China.
* China's finance ministry said it would reduce or cancel export tax rebates for copper products.
* Shanghai warehouse copper stocks down 6.6%

Zinc

Zinc prices rose by 0.4% to ?276.75, supported by firmness in base metals and concerns over supply disruptions after China announced it would cancel export tax rebates. This move has led to increased shipments of refined zinc to Shanghai Futures Exchange (ShFE) warehouses, with an additional 30,000–40,000 metric tons expected. Zinc stocks in ShFE-monitored warehouses nearly doubled in the past week, with total inventory reaching 50,563 tons, a rise of 24,039 tons. Despite these deliveries, the global zinc market recorded a deficit of 66,300 metric tons in August, up from 51,000 tons in July, according to the International Lead and Zinc Study Group (ILZSG). For the first eight months of 2024, the global surplus narrowed to 127,000 tons, significantly lower than 418,000 tons during the same period last year. China's zinc consumption in August fell by 3% year-on-year to 581,000 tons, while domestic refined zinc production in September increased by over 2% month-on-month but decreased by 8% year-on-year. Production gains were driven by smelters resuming operations after maintenance, especially in Sichuan, Gansu, and Inner Mongolia. October production is expected to see modest growth of less than 1% month-on-month, with expansions in Inner Mongolia, Shaanxi, and Hunan offset by reductions in Gansu due to routine maintenance. Technically, zinc is experiencing short covering, with a 7.6% decline in open interest to 2,480 contracts, while prices increased by ?1.1. Zinc finds support at ?273.5, with a break below potentially testing ?270.1. On the upside, resistance is seen at ?282.8, and a move above this level could push prices toward ?288.7. The supply-demand imbalance and China's production trends remain key drivers for zinc prices.
 

Trading Ideas:
* Zinc trading range for the day is 270.1-288.7.
* Zinc gains tracking firmness in other base metals after China announced it cancel export tax rebates, sparking global supply disruptions.
* China's August zinc consumption shrank by 3% to 581,000 tonnes, WBMS data showed.
* Chinese zinc producers are rushing to send 30,000 to 40,000 metric tons of refined zinc to Shfe warehouses.


Aluminium

Aluminium prices surged by 3.21% yesterday, settling at ?242.65, driven by tight alumina supply and production cuts or suspensions by certain enterprises. Supporting the rally, China’s finance ministry announced the reduction or cancellation of export tax rebates for aluminium effective December 1. Additionally, the first round of China’s fiscal measures, though lower than anticipated, including incremental debt financing of 6 trillion yuan, is expected to bolster corporate balance sheets and improve employment and income prospects, further aiding aluminium demand. Inventories showed a declining trend, with aluminium stocks at three major Japanese ports falling to 311,400 metric tons by October-end, a 0.5% drop from the prior month. In China, aluminium ingot inventories decreased in key regions, with Guangdong stocks falling by 3,100 tonnes to 183,200 tonnes and Wuxi inventories down 3,400 tonnes to 170,400 tonnes. Overall, domestic aluminium ingot inventories stood at 565,000 tonnes, with circulating inventories at 439,000 tonnes. On the production side, China’s primary aluminium output rose to 3.72 million metric tons in October, a 1.6% year-on-year increase, while the year-to-date output reached 36.39 million tons, up 4.3% from last year. Higher prices and strong demand prompted smelters to ramp up production despite rising raw material costs. Exports of unwrought aluminium and products grew 17% year-on-year for the first ten months, with October exports at 577,000 tons, up 31% annually. Aluminium is under fresh buying pressure, with open interest rising by 2.67% to 2,424 contracts. Immediate support is at ?237.8, with a downside target of ?232.8 if breached. Resistance is at ?248.5, and a move above this level could see prices testing ?254.2. The bullish sentiment is driven by strong fundamentals and supply constraints.
 

Trading Ideas:
* Aluminium trading range for the day is 232.8-254.2.
* Aluminium rose as alumina supply remained tight, coupled with production cuts or suspensions by some enterprises.
* China's finance ministry said it would reduce or cancel export tax rebates for aluminium, effective Dec. 1.
* Shanghai warehouse aluminium stocks down 13.3%

Cotton Candy

Cotton Candy prices fell by -0.85% to ?54,900, reflecting weak demand in the yarn market and payment constraints. India's cotton production for 2024/25 is expected to decline by 7.4% year-on-year to 30.2 million bales, primarily due to reduced planted area and crop damage from excessive rainfall and pests. The USDA revised India's cotton production estimate to 30.72 million bales, with ending stocks cut to 12.38 million bales. Acreage under cotton fell by approximately 9% to 11.29 million hectares from 12.69 million hectares last year, with farmers in Gujarat shifting to groundnuts for better returns. The Cotton Association of India (CAI) forecasts a rise in India’s cotton imports to 2.5 million bales in 2024/25, up from 1.75 million bales the previous year, while exports are expected to decline to 1.8 million bales from 2.85 million bales. This shift is likely to support global cotton prices due to reduced export availability from the world's second-largest producer. Globally, the USDA projected a 200,000-bale increase in cotton production for 2024/25, driven by higher output in China, Brazil, and Argentina, offsetting declines in the U.S. and Spain. Global trade is expected to decrease by over 500,000 bales due to lower Chinese imports, with ending stocks slightly reduced to 76.3 million bales. Technically, the market is under long liquidation, with open interest unchanged at 161 contracts as prices fell by ?470. Cotton Candy has support at ?54,900, and a break below this level could see prices test further lows. Resistance is expected at ?54,900, with a move above potentially testing higher levels. Weak domestic production and rising import dependency are key factors influencing price trends.
 

Trading Ideas:
* Cottoncandy trading range for the day is 54900-54900.
* Cotton settled down as yarn markets face weak demand and payment constraints.
* India's cotton production estimated to drop to 7-year low in 2024-25
* USDA has lowered India's cotton production forecast for the 2024-25 season to 30.72 million bales
* In Rajkot, a major spot market, the price ended at 26097.25 Rupees dropped by -0.32 percent.

Turmeric

Turmeric prices gained 1.51% yesterday, settling at ?13,538, on short covering after recent declines driven by lower demand amid rising arrivals. The market faced pressure from an expected 30-35% increase in acreage for the upcoming season, signaling higher production. However, downside was limited by reports of crop damage due to heavy rains, with losses potentially exceeding initial estimates. Favorable weather, including light rains in the Vidarbha region (20 mm) and Telangana (18 mm), supported crop growth. With five months left for harvesting, low supply and weather uncertainties could drive prices higher in the weeks ahead. Increased sowing activity is notable, with turmeric acreage doubling in the Erode line and rising by 30-35% in Maharashtra, Telangana, and Andhra Pradesh. Turmeric production for 2024 is estimated at 45-50 lakh bags, significantly lower than the anticipated 70-75 lakh bags for the next season, yet overall availability is expected to remain tight due to depleted outstanding stocks. Export data shows a 6.46% drop in exports during April-August 2024 to 77,584.70 tonnes compared to the same period in 2023. Imports surged by 340.21% to 14,073.83 tonnes during the same period, though August imports dropped 40.73% from July. Turmeric is under short covering, with open interest falling by -2.69% to 10,870 contracts. Immediate support lies at ?13,286, with further downside testing possible at ?13,034. Resistance is seen at ?13,754, and a move above this level could test ?13,970. The market remains poised for volatility, driven by supply-demand dynamics, weather uncertainties, and fluctuating export-import trends. Tight stocks and production concerns could sustain bullish momentum in the medium term.
 

Trading Ideas:
* Turmeric trading range for the day is 13034-13970.
* Turmeric gains on short covering after prices dropped due to lower demand amid a rise in arrivals.
* The expected acreage for the upcoming season is estimated to be 30-35% higher than last year.
* Recent weather conditions, which include dry weather followed by light rains, are benefiting crop growth.
* In Nizamabad, a major spot market, the price ended at 13650.25 Rupees gained by 0.35 percent.

Jeera

Jeera prices declined by -0.38% to ?25,010 as arrivals increased, with an average of 15,000 bags arriving daily in Unjha. Farmers are estimated to hold around 35% of the current season's stock, while the carryover stock at the beginning of the new season is projected at approximately 20 lakh bags. Export demand for jeera is expected to improve after Diwali, particularly in November-December, driven by festive season demand from Europe and other international markets. India remains the cheapest global supplier of jeera, quoted at $3,050 per tonne, significantly lower than Chinese cumin prices by $200-$250. This competitive pricing is likely to attract major buyers, including China, supporting export growth. Additionally, geopolitical tensions in the Middle East, a traditional cumin-producing region, have shifted demand to India, boosting export volumes. Data from the Federation of Indian Spice Stakeholders (FISS) reveals a 128% year-on-year surge in exports during July-September 2024, reaching 52,022 metric tonnes compared to 22,830 MT last year. From April to August 2024, jeera exports rose by 61.44% to 103,614.46 tonnes compared to 64,179.94 tonnes in the same period of 2023. August exports stood at 12,544.44 tonnes, an 88.53% increase over August 2023 but a 27.92% decline compared to July 2024. Technically, jeera is under long liquidation as open interest dropped by -2.94% to 2,082 contracts while prices fell by ?95. Support is seen at ?24,620, with a break below potentially testing ?24,230. On the upside, resistance is likely at ?25,640, and a move above could push prices to ?26,270. Strong export prospects and competitive pricing are expected to support the market in the coming months.
 

Trading Ideas:
* Jeera trading range for the day is 24230-26270.
* Jeera prices dropped as arrival has increased.
* There is a possibility of 25 percent reduction in cumin sowing in Gujarat
* Carryover stock of 20 lakh bags of cumin is estimated in the new season
*In Unjha, a major spot market, the price ended at 25168.2 Rupees dropped by -0.17 percent.

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