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Gold

Gold prices rose by 0.75% to close at Rs.77,128, supported by a softer U.S. dollar and escalating geopolitical concerns. Heightened tensions stemmed from President Putin's warning of a potential nuclear-capable missile strike on Ukraine and renewed clashes between Israel and Hezbollah despite a recent ceasefire. Meanwhile, U.S. economic data showed core PCE prices in October aligned with expectations, strengthening the likelihood of a December Fed rate cut. However, resilient economic indicators suggest the Fed may adopt a cautious approach to further easing in 2024. On the physical demand front, gold buyers in India returned as prices retreated from their lightning rally, though higher rates moderated demand. Premiums remained steady at $3 an ounce over official domestic prices. In contrast, subdued demand in China led to discounts of $19–$21 per ounce, while premiums in Singapore and Hong Kong ranged from $0.50–$2.50 per ounce. Globally, gold demand excluding over-the-counter (OTC) trading remained stable at 1,176.5 metric tons in Q3, with strong investment activity offsetting weaker jewelry consumption. Total gold demand, including OTC trading, rose by 5% to a record 1,313 tons for Q3, driven by a 97% increase in OTC flows. Gold saw fresh buying interest, with a 5.09% rise in open interest to 12,637 contracts. Support is pegged at ?76,960, with further downside testing possible at Rs.76,795. Resistance stands at Rs.77,270, and a move above this could push prices to Rs.77,415.

Trading Ideas:

* Gold trading range for the day is 76795-77415.

* Gold climbed supported by a softer US dollar and rising geopolitical tensions.

* Russian President Putin suggests hypersonic missile may attack Ukraine's decision-making centers.

* US President-elect Trump pledges tariffs on Canadian, Mexican, and Chinese products, potentially triggering trade wars.

Silver

Silver prices surged by 1.19% to close at Rs.91,209, driven by heightened safe-haven demand due to escalating geopolitical risks. Russian President Vladimir Putin's warning of potential nuclear-capable missile strikes on Ukraine and renewed clashes between Israel and Hezbollah over a ceasefire violation fueled market concerns. A weaker U.S. dollar and declining Treasury yields also supported silver prices, as investors anticipated further rate cuts by the U.S. Federal Reserve. The global silver market is expected to face a deficit of 182 million ounces in 2024, marking the fourth consecutive year of structural undersupply, according to the Silver Institute. Record industrial demand, particularly from electronics, electric vehicles, and solar panels, along with a recovery in jewelry consumption, is projected to lift demand to 1.21 billion ounces, despite a 16% decline in physical investment. On the supply side, mine output is forecasted to increase by 1%, supported by higher production in Mexico, Chile, and the U.S., while recycling is expected to rise by 5% due to increased western silverware scrap. In India, silver imports surged to 4,554 metric tons in the first half of 2024, compared to just 560 tons a year earlier. The increased demand stems from solar panel and electronics manufacturing, alongside investor interest in silver as a high-return alternative to gold. Silver witnessed short covering, with open interest declining by 3.24% to settle at 25,114 contracts. Support is seen at Rs.90,685, with further downside testing possible at Rs.90,155. Resistance is pegged at Rs.91,815, and a break above could propel prices to Rs.92,415.

Trading Ideas:

* Silver trading range for the day is 90155-92415.

* Silver prices climbed as growing geopolitical risks spurred safe-haven demand

* Russian President Vladimir Putin warned about a possible nuclear-capable ballistic missile strikes on Ukraine

* PCE data shows US inflation stalled in October, with investors believing Trump's policies will boost inflation.

Crude oil

Crude oil prices fell by 0.51% to settle at Rs.5,814 as markets weighed the potential for increased global supply in 2025, despite expectations of continued OPEC+ output cuts. Concerns over geopolitical tensions added a risk premium, with Israel and Hezbollah accusing each other of breaching a ceasefire and President Putin warning of a possible nuclear-capable missile strike on Ukraine. However, these conflicts have not disrupted oil supplies significantly, with the International Energy Agency forecasting a surplus of over 1 million barrels per day (bpd) in 2025, amounting to more than 1% of global output. U.S. crude oil inventories declined by 1.844 million barrels last week, surpassing market expectations of a 1.1 million-barrel draw. Meanwhile, gasoline stocks rose by 3.314 million barrels, significantly above the forecasted 0.2 million-barrel increase, and distillate inventories grew by 0.416 million barrels. The Energy Information Administration (EIA) revised its global oil demand growth forecast for 2025 downward to 1.2 million bpd, citing weaker economic activity in China and North America. U.S. oil production projections for 2025 were also reduced to 13.54 million bpd, down 1% from earlier estimates. Crude oil is experiencing fresh selling, with open interest increasing by 0.1% to settle at 10,504 contracts. Support is at Rs.5,763, and a drop below could test Rs.5,711 levels. Resistance is pegged at Rs.5,886, and a move above may push prices toward Rs.5,957.

Trading Ideas:

* Crudeoil trading range for the day is 5711-5957.

* Crude oil dropped amid prospect of increased supply in 2025

* U.S. crude stockpiles fell more than expected this week

* OPEC+ shifts meeting to Dec. 5, could further delay output hike

Natural gas

Natural gas prices rose by 1.76% to settle at Rs.283.2, supported by a report from the U.S. Energy Information Administration (EIA) showing a 2 billion cubic feet (bcf) withdrawal from storage, contrary to expectations of a 3 bcf build. This marked the second consecutive weekly draw as colder temperatures lifted demand. However, gains were capped by rising production and forecasts for milder weather over the next two weeks. U.S. output in November averaged 101.4 billion cubic feet per day (bcfd), up from 101.1 bcfd in October, though below the record 105.3 bcfd in December 2023. LNG exports bolstered demand, with flows to U.S. export facilities rising to 13.5 bcfd in November, compared to 13.1 bcfd in October. Weather forecasts indicate near-normal temperatures through mid-December, likely moderating immediate demand. The EIA projects 2024 natural gas production to decline slightly to 103.3 bcfd, while consumption is expected to hit a record 90.0 bcfd before easing in 2025. Storage levels stand at 3,967 bcf, 3.5% higher than last year and 7.2% above the five-year average, offering a cushion against rising demand. Natural gas prices are under short covering, as open interest dropped by 7.45% to settle at 16,292 contracts. Support is at Rs.278.8, with a break below potentially testing Rs.274.4 levels. Resistance is pegged at Rs.287, and a move above could push prices toward Rs.290.8.

Trading Ideas:

* Naturalgas trading range for the day is 274.4-290.8.

* Natural gas gains after report showing utilities pulled an expected 2 Bcf of gas from storage.

* U.S. utilities pulled 2 bcf of gas from storage last week -EIA

* Cold weather boosts spot gas prices to highest since January in parts of U.S.

Copper

Copper prices edged up by 0.19% to settle at Rs.808.9, supported by optimism over potential economic stimulus measures in China. Investors anticipate key announcements during December's Politburo and Central Economic Work Conference meetings, aimed at bolstering economic growth. A weaker U.S. dollar also underpinned the market, following matched PCE inflation data and the nomination of Scott Bessent as U.S. Treasury Secretary, which pressured the dollar. Supply and demand dynamics provided additional support. The International Copper Study Group (ICSG) reported a global refined copper deficit of 131,000 metric tons in September, reversing the surplus of 43,000 metric tons seen in August. China’s imports of unwrought copper rose 1.1% year-on-year in October to 506,000 metric tons, reflecting improved seasonal demand. Total imports for the first 10 months reached 4.6 million metric tons, up 2.4% annually. Meanwhile, domestic refined copper production rose by 5.4% to 10.04 million tons for January-September 2024. Copper concentrate imports also showed resilience, increasing by 0.2% year-on-year in October to 2.31 million tons, and up 3.3% for the year to date. However, Yangshan premiums, a key indicator of Chinese import appetite, fell from $69/ton in October to $48/ton recently, signaling tempered demand momentum. Copper prices witnessed short covering as open interest declined by 2.46% to 8,174 contracts. Immediate support is at Rs.806.9, with a potential test of Rs.804.7 if breached. Resistance is seen at Rs.811.9, and a breakout above could lead prices toward Rs.814.7.

Trading Ideas:

* Copper trading range for the day is 804.7-814.7.

* Copper rose amid growing speculation that Beijing will roll out additional stimulus measures.

* Concerns over Trump’s proposed tariffs on China, Mexico, and Canada eased as traders await further details on the plans.

* Chile’s copper output increased 6.7% year-on-year in the period to 492,804 metric tons.

Zinc

Zinc prices rose by 1.38% to settle at Rs.286.7, supported by a sharp drop in inventories at warehouses monitored by the Shanghai Futures Exchange, which fell by 10.6% week-on-week. Additionally, tightening zinc supply continues to provide a bullish outlook. Though zinc concentrate inventory at ports has risen, the reduced smelter output in Q3 has kept the market constrained. Smelter production in Q4 remains historically low, around 500,000 metric tons, underpinning prices. On the global front, Trafigura Group's withdrawal of significant zinc volumes from London Metal Exchange (LME) warehouses—totaling over 97,225 metric tons in two days—has reduced LME inventory availability. This withdrawal, the largest in over a decade, has fueled supply concerns, further boosting prices. The global zinc market deficit narrowed slightly to 79,500 metric tons in September from 85,000 tons in August, with a cumulative deficit of 8,000 tons for January-September 2024 compared to a surplus of 358,000 tons in the same period last year. China's refined zinc production rose over 2% month-on-month in September, though it remained 8% lower year-on-year. Output is expected to increase marginally in October as smelters recover from maintenance. However, raw material shortages remain a challenge, keeping production gains subdued. Zinc saw fresh buying interest, with open interest surging by 24.65% to 3,160 contracts. Immediate support is at Rs.283.6, with further downside testing possible at Rs.280.4. Resistance is seen at Rs.288.5, with a potential move toward Rs.290.2 if breached.

Trading Ideas:

* Zinc trading range for the day is 280.4-290.2.

* Zinc gains as SHFE inventories fell 10.6% from last Friday.

* Under the background of winter stockpiling, the overall supply of ore remains tight.

* As for smelter production, it remains at a historical low of around 500,000 mt, providing bottom support for zinc prices.

Aluminium

Aluminium prices settled up by 0.29% at Rs.242.35, supported by signs of stronger demand from China, the world’s largest aluminium consumer. Chinese exports of unwrought aluminium and related products surged 17% year-on-year during the first ten months of 2024, reflecting robust global demand. Specifically, exports for October increased by 31% compared to the previous year, underscoring the global strength of aluminium markets. Additionally, China’s aluminium production in October rose by 1.6% year-on-year, with total production for the first ten months up by 4.3%, suggesting healthy demand from domestic industries. Concerns about tightening supply in Asia have also contributed to price support. Chinese authorities have announced the removal of a 13% export tax rebate on semi-manufactured aluminium products, potentially squeezing supply further. In response, global aluminium producers have raised premiums for Japanese buyers for January-March shipments by up to 49% from the previous quarter, reflecting concerns over tight supply and rising costs. However, gains in aluminium prices have been capped by uncertainties surrounding potential U.S. tariffs, which are likely to weigh on global trade dynamics. Domestically, aluminium ingot outflows increased slightly by 7,300 metric tons week-on-week, but inventories still saw a buildup, with a 14,000 metric ton increase in available stock. Aluminium prices are currently under short covering, with open interest dropping by 2.41% to 3,317 contracts. Immediate support is seen at Rs.241.8, with further downside potential to Rs.241.2. Resistance is expected at Rs.243.2, and a move beyond this could see prices testing Rs.244. 

Trading Ideas:

* Aluminium trading range for the day is 241.2-244.

* Aluminium gains supported by emerging signals of firmer demand in China

* Global aluminium producers have offered Japanese buyers premiums of $230-$260 per metric ton for January-March primary metal shipments.

* Aluminium inventories in warehouses monitored by the Shanghai Futures Exchange fell 1.7% from last Friday

Cotton candy

Cotton candy prices settled up by 0.04% at Rs.55,800, driven by rising demand for cotton yarn in South India, supported by a surge in garment industry orders and strong export activity. However, the cotton market faces significant supply-side challenges. India’s cotton production for the 2024/25 season is forecast to drop by 7.4% to 30.2 million bales due to reduced planted area and crop damage from excessive rainfall. The USDA also revised its India production forecast down to 30.72 million bales, further tightening supply. This decline in domestic production is expected to reduce exports and increase the need for imports, which are projected to rise to 2.5 million bales from 1.75 million bales in the previous year. With lower output in India, global cotton prices could be supported, particularly as global production estimates have been revised up by 200,000 bales, mainly due to higher output in China, Brazil, and Argentina. However, weaker production in the U.S. due to Hurricane Helene and reduced global import demand are exerting some downward pressure on the market. In India, cotton acreage has fallen by 9% year-on-year, particularly in Gujarat, where farmers opted for more profitable crops like groundnuts. As a result, demand for cotton in India is expected to remain steady at 31.3 million bales in 2024/25, despite the supply shortage. Cotton candy prices are experiencing fresh buying, with open interest increasing by 0.36% to 275 contracts, signaling bullish sentiment. Immediate support is at Rs.55,670, with further downside potential at Rs.55,530. Resistance is seen at Rs.55,980, and a break above this level could push prices towards Rs.56,150.

Trading Ideas:

* Cottoncandy trading range for the day is 55530-56150.

* Cotton gains as South India sees high cotton yarn demand

* 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 26098.95 Rupees dropped by -0.28 percent.

Turmeric

Turmeric prices settled up by 0.95% at Rs.13,552, driven by strong buying activity as the market continues to face low supplies ahead of the new crop arrival. While turmeric arrivals increased to 9,030 bags from 7,965 bags in the previous session, the stock levels remain low, which is expected to keep prices firm until the new crop arrives. Major markets like Hingoli and Erode reported strong arrivals, though Hingoli was closed intermittently due to ongoing assembly elections in Maharashtra, potentially disrupting trading activity in the short term. Despite an increase in sowing area, delays in harvesting due to prolonged rains may impact the availability of the new crop, keeping the supply tight. In Indonesia, dry weather has accelerated harvesting, although global export demand remains weak. Domestic sowing has increased significantly, with turmeric sowing in the Erode line reported to be double that of last year, and sowing in Maharashtra, Telangana, and Andhra Pradesh up by 30-35%. As a result, production estimates for 2024 stand at 45-50 lakh bags, with an outstanding stock of 35-38 lakh bags. Turmeric exports saw a modest increase of 0.96% during April-September 2024, while imports surged by 184.73%, reflecting shifts in domestic demand. In Nizamabad, a key market, turmeric prices gained 0.32% to Rs.14,119. The market is under short covering, with open interest decreasing by 2.01% to settle at 8,515 contracts. Support is at Rs.13,356, and a move below could test Rs.13,160. Resistance is seen at Rs.13,714, and a break above could push prices to Rs.13,876.

Trading Ideas:

* Turmeric trading range for the day is 13160-13876.

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

* Turmeric arrivals rose to 9,030 bags from 7,965 bags in the previous session.

* Although crop acreage has improved, delay in harvesting due to prolonged rains may impact the timelines of fresh supplies.

* In Nizamabad, a major spot market, the price ended at 14119 Rupees gained by 0.32 percent.

Jeera

Jeera prices settled up by 1.06% at Rs.25,255, supported by weather-related sowing delays in key producing states, particularly Gujarat and Rajasthan. Higher temperatures in recent weeks have hindered the seeding process and led to poor germination, especially in Gujarat, the largest producing state. As of November 25, only 57,915 hectares were seeded compared to 2.44 lakh hectares last year, representing just 15% of the normal sowing area. The delay in sowing, estimated at 20-25 days, is likely to affect overall production. India’s cumin seed production for 2023-24 increased to 8.6 lakh tonnes from 11.87 lakh hectares, a rise from the previous year’s 5.77 lakh tonnes. However, production for 2024 is expected to decrease by 10%, with Rajasthan’s production potentially falling by 10-15%. India remains the world’s cheapest source of cumin, attracting strong international demand, especially from China and Europe. The country’s cumin prices are quoted at $3,050 per tonne, much cheaper than Chinese cumin, which is priced $200-250 higher. Jeera exports have surged by 70.02% to 119,249.51 tonnes in the first half of 2024, compared to 70,139.89 tonnes last year. Exports in September rose 24.64% month-on-month and 162.34% year-on-year, driven by increased demand during the festive season. The market is experiencing short covering, with open interest declining by 5.99% to 2,118 contracts. Support is seen at Rs.24,940, and a move below could test Rs.24,630. Resistance is at Rs.25,470, and a breakout above could push prices to Rs.25,690.

Trading Ideas:

* Jeera trading range for the day is 24630-25690.

* Jeera gained as sowing has been delayed in Gujarat and Rajasthan on weather issues.

* 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 24951.7 Rupees dropped by -0.03 percent.

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