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Gold 

Gold experienced a marginal decline of -0.06% to settle at 58,593 as traders analyzed the latest US Consumer Price Index (CPI) data. The 10-year US Treasury note yield reached 4.3%, nearing the 15-year high of 4.34% seen on August 22nd. The US dollar index remained relatively steady, hovering around 104.93 after a brief increase. In August, headline annual inflation exceeded expectations, primarily driven by surging oil prices, while the core inflation rate slowed as anticipated. Despite this, the outlook for the Federal Reserve's next moves remained largely unchanged. A rate hike pause is anticipated for the coming week, with a 40% likelihood of a 0.25% rate increase in either November or December. On the global front, the European Central Bank (ECB) was set to decide on monetary policy, leaving investors divided on whether they would halt or continue raising borrowing costs. Meanwhile, the People's Bank of China added a substantial 29 tons of gold to its reserves in August. In India, discounts on physical gold reached their highest level in seven weeks due to elevated domestic rates, while in China, premiums rose, driven by optimism stemming from the country's economic support measures. From a technical standpoint, the gold market saw long liquidation, with open interest decreasing by -1.31% to settle at 11,084. Prices dipped by -33 rupees. Support for gold is at 58,515, and a further drop could test 58,435 levels. Conversely, resistance is expected at 58,685, and if breached, prices may aim for 58,775.

Trading Ideas:
* Gold trading range for the day is 58435-58775.
* Gold prices steadied as traders digest fresh US CPI figures.
* The yield on the 10-year US Treasury note rose to the 4.3% mark, approaching the 15-year high of 4.34%
* Headline annual inflation rate rose more than expected in August, prompted by high oil prices


Silver
Silver saw a decline of -0.72% yesterday, settling at 71,419, as investors reacted to the latest inflation rate report. In the US, annual inflation climbed for the second consecutive month to 3.7% in August, surpassing the expected 3.6%. Additionally, the monthly Core CPI increased by 0.3%, up from the previous month's 0.2%, and market forecasts. While this report may not significantly impact the Fed's September interest rate decision, there's ongoing debate about whether the Federal Reserve will implement another rate hike this year. Several factors are strengthening the hawkish outlook for the US central bank, including low unemployment claims and resilient services PMI data. As a result, financial markets generally expect the Fed to maintain rates this month. However, concerns about persistent inflation have led nearly half of the market to bet on a final 0.25% hike in November, which has put pressure on Treasury securities prices in the secondary market. In August 2023, US consumer prices increased by 0.6% month-over-month, following a 0.2% rise in July, aligning with market expectations. Core consumer prices, excluding volatile items like food and energy, also rose by 0.3% from the previous month. From a technical perspective, the silver market is experiencing fresh selling, with open interest rising by 5.36% to 18,026, while prices have fallen by -515 rupees. Silver's support is at 71,140, with potential testing of 70,855 if it breaks. Resistance is expected at 71,780, and a move above this level may lead to a test of 72,135.

Trading Ideas:
* Silver trading range for the day is 70855-72135.
* Silver dropped as investors were digesting the latest inflation rate report.
* The annual inflation rate in the US rose for a second consecutive month to 3.7% in August
* Consumer prices in the United States rose 0.6% month-over-month in August 2023

Crude oil

Crude oil faced a setback, declining by -0.64% to settle at 7,338, primarily due to concerns over energy demand and an unexpected surge in US crude inventories. The EIA Petroleum Status Report revealed a 3.954 million barrel increase in US crude stocks, contradicting market expectations of a 1.912 million barrel drawdown. In Libya, four major oil ports, including Brega, Es Sidra, Ras Lanuf, and Zueitina, reopened after being closed due to a powerful storm. Despite challenges such as high interest rates and inflation, OPEC maintained its optimistic outlook, projecting robust global oil demand growth of 2.44 million barrels per day (bpd) in 2023 and 2.25 million bpd in 2024. These forecasts remained unchanged from the previous month. China's decision to lift pandemic-related lockdowns contributed to increased oil demand in 2023. OPEC anticipates global oil demand to average 102.1 million bpd in 2023, surpassing pre-pandemic levels observed in 2019. From a technical standpoint, the crude oil market witnessed long liquidation, with open interest dropping significantly by -33.78% to 6,721, while prices declined by -47 rupees. Crude oil's support level is at 7,299, potentially testing 7,261 if breached, and resistance is expected at 7,403, with potential testing of 7,469 upon breaking this level.

Trading Ideas:
* Crudeoil trading range for the day is 7261-7469.
* Crude oil falls due to energy demand concerns and surprise US inventory surge
* US crude oil inventories rose by 3.954 million barrels
* Libyan oil ports reopen after storm forced closure

Natural gas 

Natural gas saw a substantial decline of -3.74%, settling at 221.3, primarily due to forecasts of milder weather and reduced gas demand for the upcoming week. This drop was also influenced by a decrease in gas flow to LNG export plants, notably the Freeport LNG plant in Texas. Interestingly, gas prices fell despite a recent drop in gas output to a five-month low. Daily output was on track to decline by approximately 3.1 billion cubic feet per day (bcfd) over the past three days, reaching a preliminary five-month low of 99.6 bcfd on Wednesday, although preliminary data can be revised. Meteorologists predict near-normal weather for the period from September 13th to 21st, followed by warmer-than-usual conditions from September 22nd to at least September 28th. However, as cooler seasonal weather approaches, US gas demand, including exports, is expected to decrease from 99.9 bcfd this week to 94.9 bcfd next week, a lower forecast compared to earlier in the week. Gas flows to the seven major US LNG export plants averaged 12.6 bcfd in September, up slightly from 12.3 bcfd in August but below the monthly record of 14.0 bcfd in April. From a technical perspective, the natural gas market witnessed fresh selling, with open interest surging by 34.02% to 35,319, while prices dropped by -8.6 rupees. Support for natural gas is at 217.3, with potential testing of 213.2 if this level is breached. Resistance is expected at 228.1, and a move above it could lead to testing of 234.8.

Trading Ideas:
* Naturalgas trading range for the day is 213.2-234.8.
* Natural gas slid on forecasts for milder weather, lower gas demand next week.
* Pressure also seen amid a decline in the amount of gas flowing to LNG export plants.
* However, prices declined despite a drop in output this week to a five-month low.


Copper 

Copper posted a modest gain of 0.08%, settling at 732.7, with support stemming from Beijing's measures to rejuvenate the troubled property market. Notably, property developer Country Garden received creditor approval to extend repayment on six onshore bonds by three years, providing a boost to copper. China's copper cathode production in August exceeded expectations, with a 6.8% monthly increase and a 15.5% year-on-year growth. Year-to-date, copper output reached 7.47 million metric tons, up by 11.52% compared to the previous year, with minimal smelter maintenance in August. Major Chinese copper markets held 95,100 metric tons, down 5,400 metric tons from the previous week but up 5,300 metric tons year-on-year. Over the weekend, copper inventories in Shanghai decreased by 3,800 metric tons to 71,300 metric tons, while inventories in Guangdong dropped by 2,800 metric tons to 9,500 metric tons. In Jiangsu, copper inventories increased by 1,000 metric tons to 6,000 metric tons, and Chengdu saw a rise of 200 metric tons to 800 metric tons. Shanghai and Guangdong witnessed lower shipments arrivals, while downstream stockpiling increased amidst falling copper prices. From a technical standpoint, the copper market experienced short covering, with a -4.83% drop in open interest to 4,985, while prices increased by 0.6 rupees. Copper's support level is at 730.1, with potential testing of 727.3 if breached, and resistance is expected at 735.7, with potential testing of 738.5 upon breaking this level.

Trading Ideas:
* Copper trading range for the day is 727.3-738.5.
* Copper gains as Beijing issuing supporting measures to revive a property market.
* Copper major Chinese markets stood at 95,100 mt, down 5,400 mt from last Friday
* China's copper cathode output in August was 989,000 mt, an increase of 63,100 mt or 6.8% month-on-month

Zinc 

Zinc prices rose by 1.29% to reach $223.55, driven by ongoing declines in inventories and expectations of reduced overseas zinc concentrate production. The market currently exhibits a notable discount on near-term zinc delivery compared to the three-month contract on the London Metal Exchange (LME). This discount, or contango, reached $24.50 per metric ton, its deepest since March 2021, emphasizing the immediate supply surplus. In August 2023, zinc inventories in LME-approved warehouses experienced a significant increase, reaching 153,575 metric tons, the highest since February 2022, compared to 93,525 in mid-August. However, they have since decreased to 138,400 tons, as indicated by LME daily data. Zinc is primarily used for galvanizing steel, and stocks in warehouses monitored by the Shanghai Futures Exchange have doubled this year, totaling 46,579 tons. China's refined zinc output in August 2023 amounted to 526,500 metric tons, marking a 4.46% month-on-month decline but a year-on-year increase of 13.78%, although falling short of expectations. From a technical perspective, the market has seen fresh buying interest, with open interest increasing by 10.93% to settle at 4,922, and prices rising by 2.85 rupees. Currently, zinc finds support at $220.8, with potential testing of $218.1. On the upside, resistance is expected at $225.1, with the possibility of prices testing $226.7.

Trading Ideas:
* Zinc trading range for the day is 218.1-226.7.
* Zinc prices gains amid continued decline in inventories.
* Support also seen amid the expected reduction in overseas zinc concentrate production.
* In August 2023, China's refined zinc output was 526,500 mt, a decrease of 24,600 mt or 4.46% month on month


Aluminium 

Aluminium prices experienced a 0.6% increase, closing at $202.3 per ton, driven by ANZ's prediction of an impending deficit in the aluminium market by 2024. This projection hints at a potential price surge in the near future. ANZ maintains its price forecast for the 0-3 month period at $2,500 per ton. Several factors contribute to these market dynamics, including supply pressures caused by China's production cap of 45 million tons and Indonesia's bauxite export ban. The surge in demand for solar panels and electric vehicles in China is expected to counterbalance the decrease in aluminium use in construction, indicating a recovery in purchasing activity. China Hongqiao Group's activation of 1.5 million metric tons of aluminium smelting capacity in Southwest China, with plans to reach 4 million tons by the end of 2025, is a strategic move to leverage low-carbon energy sources. August 2023 saw China's aluminium production rise to 3.623 million metric tons, marking a 3.9% year-on-year increase. The daily output in August also showed a month-on-month increase of 1,785 metric tons, totaling approximately 116,900 metric tons. From January to August, the total production reached 27.299 million metric tons, reflecting a 2.8% year-on-year increase. In August, the proportion of liquid aluminium increased in northern and central factories, although it decreased slightly in some southwestern factories. From a technical standpoint, the market exhibited signs of short covering as open interest dropped by -4.98% to 3,720, while prices increased by 1.2 rupees. Currently, aluminium finds support at $201.2 per ton, with potential testing of the $200 level. On the upside, resistance is expected at $203.2 per ton, with a potential price test at $204.

Trading Ideas:
* Aluminium trading range for the day is 200-204.
* Aluminium gains as ANZ anticipates a shift in the aluminum market towards a deficit
* Supply pressures are escalating due to China's halting of production capacity beyond the current limit of 45 million tons
* China Hongqiao shifts 1.5 mln T aluminium capacity to Yunnan so far

Cotton 

Cotton prices experienced a decline of -0.81%, settling at 60900, primarily due to concerns regarding demand from China. The U.S. cotton market for 2023/24 reveals higher beginning stocks but lower production, exports, and ending stocks. Unexpectedly large warehouse stocks reported for July 31, 2023, contributed to higher beginning stocks for 2022/23. U.S. production for 2023/24 is forecasted to decrease by 860,000 bales, with notable declines in the Southeast and Southwest regions. While consumption remains unchanged from August, exports are down by 200,000 bales, and ending stocks are 100,000 bales lower. The season-average price for upland cotton in 2023/24 is projected at 80 cents per pound, up 1 cent from the previous month. On the global front, 2023/24 world cotton projections indicate lower beginning stocks, production, consumption, trade, and ending stocks compared to the previous month's estimates. India's cotton sowing has seen a 3.65 lakh hectare decrease compared to last year, attributed to poor monsoon conditions in Gujarat, mill closures, and low stock of old cotton crops. Early arrivals of the new cotton crop in North and South India have started above the minimum support price levels, with expectations of increased arrivals post-September 15. Cotton picking in Telangana is set to gain momentum in November, with favorable conditions expected for the 2023-24 cotton crop. In Rajkot, a significant spot market, cotton prices concluded at 29480.6 Rupees, marking a -0.26 percent decrease. From a technical standpoint, the market reflects fresh selling activity, with open interest increasing by 4.3% to reach 97, while prices fell by -500 rupees. Currently, Cottoncandy finds support at 59760, with potential testing of 58630 levels. Resistance is expected at 61620, and a move above this level could lead to price testing at 62350.

Trading Ideas:
* Cottoncandy trading range for the day is 58630-62350.
* Cotton dropped due to concerns about demand from China
* However, heavy rainfall in China's Xinjiang region is expected to impact cotton quality and quantity.
* China's cotton production was lowered to 5.9 million metric tons on reduced planted area for 2023/24
* In Rajkot, a major spot market, the price ended at 29480.6 Rupees dropped by -0.26 percent.

Turmeric

In the recent turmeric market, we've seen a notable price increase of 2.24%, settling at 13992. This surge can be attributed to heightened buying activity driven by increased festive demand. However, it's essential to note that supplies are dwindling, and there are concerns about a decrease in turmeric cultivation in Maharashtra, Tamil Nadu, Andhra Pradesh, and Telangana. This shift in focus by farmers could lead to a 20-25% reduction in turmeric sowing this year, further tightening supply. Despite the positive news of expected rainfall in Maharashtra and Telangana, which should support crop growth, the overall supply remains limited. Export inquiries have been subdued, putting pressure on prices. On the export front, there has been a 16.87% increase in turmeric exports from April to June 2023 compared to the same period in 2022, with 57,775.30 tonnes shipped. Adding to the complexity of the situation is India's lowest monsoon rains in eight years, driven by El Niño weather patterns. This deficit in September precipitation could potentially drive up prices for essential commodities like sugar, pulses, rice, and vegetables, leading to higher food inflation. From a technical perspective, the market has seen fresh buying interest, with open interest increasing by 0.74% to settle at 14910. Prices have risen by 306 rupees. Support for turmeric is currently at 13794, with the possibility of a test at 13598 levels. On the upside, resistance is likely to be encountered at 14142, and a move above that level could see prices testing 14294.

Trading Ideas:
* Turmeric trading range for the day is 13598-14294.
* Turmeric prices gained as buying activities has improved.
* Supplies are down whereas production prospects are also looking bleak
* The upcoming week is expected to bring normal to above-normal rainfall to Maharashtra and Telangana
* In Nizamabad, a major spot market, the price ended at 13620.05 Rupees gained by 0.16 percent.

Jeera 

Jeera prices have surged by 2.09%, settling at 62860, primarily due to a decline in local supplies and heightened festival demand. Stockists are showing increased interest, considering the dwindling stocks held by millers. However, Indian jeera faces challenges in the export market due to price competitiveness, particularly with reduced buying from China, a significant buyer. The uncertainty of China's potential purchases in October-November before new cumin arrivals adds to market unpredictability. Drier weather in Gujarat is expected to increase jeera arrivals, limiting upward price movement. FISS forecasts indicate that cumin demand may surpass supply this year, with 85 lakh bags in demand against a likely supply of 65 lakh bags. Jeera exports from April to June 2023 rose by 13.16% compared to the same period in 2022, reaching 53,399.65 tonnes. However, June 2023 exports saw a significant drop of 59.81% compared to May 2023, potentially reflecting export challenges. India faces its lowest monsoon rains in eight years, driven by El Niño weather patterns, which could lead to higher prices for essential commodities like sugar, pulses, rice, and vegetables, causing food inflation.  From a technical perspective, the market has witnessed fresh buying interest, with open interest increasing by 14.11% to settle at 4707. Prices have risen by 1285 rupees. Jeera is currently supported at 61130, with the possibility of testing 59390 levels on the downside. On the upside, resistance is likely at 64320, with the potential for prices to test 65770.

Trading Ideas:
* Jeera trading range for the day is 59390-65770.
* Jeera prices gained due to a decrease in supplies.
* The increased demand for jeera during festivals has piqued the interest of stockists
* Drier weather condition in Gujarat will also lead to rise in arrivals that will cap the upwards move.
* In Unjha, a major spot market, the price ended at 60911.75 Rupees gained by 0.17 percent