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Gold

Gold prices surged 1.45% to Rs.82,044 as a fresh decline in US Treasury bond yields boosted demand for the safe-haven asset. Additionally, concerns over potential economic disruptions from former US President Donald Trump’s tariff plans added to gold’s appeal. Speculation about future Federal Reserve rate cuts also supported prices, as Trump has pushed for lower interest rates, and inflation data hints at potential easing. However, Fed Chair Jerome Powell emphasized that political factors would not influence the central bank’s policy decisions. Meanwhile, demand for physical gold remained subdued in major Asian markets. Indian dealers offered the highest discounts in over six months, reaching $38 per ounce, compared to last week's $30 discount, amid speculation about potential changes in import duties in the upcoming budget. In China, gold traded with a $10 premium, while Hong Kong and Japan saw minor fluctuations in premiums and discounts. The bullion lending market also saw increased activity, with London bullion traders borrowing gold from central banks to cover a surge in deliveries to the US due to possible import tariffs. Global central banks remained net buyers of gold, with Poland leading purchases, adding 21 tonnes in November, followed by India, which increased its reserves by 8 tonnes. Technically, gold is in a fresh buying phase, with open interest rising by 11.66% to 15,841 contracts. Support is at Rs.81,310, with further downside at Rs.80,575. Resistance is at Rs.82,440, and a breakout above could push prices toward Rs.82,835.
 

Trading Ideas:
* Gold trading range for the day is 80575-82835.
* Gold prices rallied to all time high amid fresh leg down in the US Treasury bond yields.
* Further concerns about the potential economic fallout from US President Trump's tariff plans supported prices.
* Fed Chair Powell said that politics would not affect the central bank's interest-rate calls and downplayed expectations for future rate cuts.


Silver
Silver prices surged 1.72% to Rs.93,446, tracking bullion’s strength as traders assessed the Federal Reserve’s policy stance. The Fed held interest rates steady without signaling any immediate cuts, allowing markets to price in two rate reductions later this year. This supported silver, which benefits from lower interest rates. Additionally, strong retail demand and industrial optimism contributed to bullish sentiment. The Silver Institute projected a supply deficit for the fifth consecutive year in 2025, driven by rising industrial demand despite higher output from China, Canada, and Chile. On the industrial front, silver demand is set to reach a record high of over 700 million ounces, supported by growth in the green economy, particularly in solar panel production. While industrial fabrication is expected to rise by 3%, total silver demand is forecast to remain stable at 1.2 billion ounces. Investment demand is projected to rise by 3%, led by Western markets, while jewelry and silverware demand is expected to decline by 6%, mainly due to weaker demand from India. Supply is forecast to grow by 3% to 1.05 billion ounces, with mine production hitting a seven-year high of 844 Moz and recycling volumes surpassing 200 Moz for the first time since 2012. Technically, silver remains in a fresh buying phase, with open interest rising 5.58% to 22,597 contracts. Immediate support is at Rs.92,500, with further downside at Rs.91,550. Resistance is at Rs.94,100, and a breakout above could push prices toward Rs.94,750.
 

Trading Ideas:
* Silver trading range for the day is 91550-94750.
* Silver rose tracking the strong momentum for bullion as traders assessed the Fed’s policy outlook this year.
* The US central bank held its rates unchanged, as expected, and refrained from giving major hints on its outlook.
* Silver Institute forecast that the silver market will remain in a supply deficit for the fifth straight year in 2025.


Crude Oil
Crude oil prices rose 0.4% to Rs.6,319 as investors assessed geopolitical and trade risks, particularly the potential 25% tariffs threatened by the U.S. on imports from Canada and Mexico, its top crude suppliers. Meanwhile, U.S. sanctions on Russia led to an 8% decline in crude exports from Russia’s western ports in February as Moscow increased refining activity. Canada and Mexico supplied a combined 4.63 million barrels per day (bpd) to the U.S. in 2023, highlighting their critical role in U.S. crude imports. Kazakhstan's decision on output cuts will depend on the next OPEC+ meeting, as the country continues to exceed its production quota. In the latest U.S. inventory report, crude stocks rose for the first time in ten weeks by 3.463 million barrels, exceeding the expected 3.2 million-barrel build. Stocks at the Cushing hub also increased by 0.326 million barrels. Gasoline inventories climbed by 2.957 million barrels, while distillate stocks fell sharply by 4.994 million barrels. Meanwhile, net U.S. crude imports rose by 0.532 million bpd. The U.S. Energy Information Administration (EIA) forecasted global oil production to reach 104.4 million bpd in 2025, with demand estimated at 104.1 million bpd, suggesting potential supply pressures. Technically, crude oil is witnessing short covering, with open interest dropping 2.71% to 7,799 contracts. Immediate support is at Rs.6,255, with a break below targeting Rs.6,191. Resistance is at Rs.6,378, and a move above this level could push prices toward Rs.6,437.
 

Trading Ideas:
* Crudeoil trading range for the day is 6191-6437.
* Crude oil gains as investors focused on tariffs threatened by U.S. President Donald Trump on Mexico and Canada.
* U.S. sanctions on Moscow are squeezing crude oil exports from Russia's western ports, which are set to fall 8% in February
* US crude stocks increased for the first time in ten weeks, along with a rise in gasoline inventories.


Natural Gas
Natural gas prices declined by 1.68% to Rs.269.1, pressured by forecasts of milder weather and lower heating demand in the coming week. Meteorologists predict temperatures in the Lower 48 states will remain above normal until February 7 before returning to near-normal levels. The expected decline in demand weighed on prices, despite a massive gas withdrawal reported by the EIA due to last week's extreme cold. U.S. gas production fell from 103.8 billion cubic feet per day (bcfd) in December to 102.3 bcfd in January due to freeze-offs. LSEG expects gas demand, including exports, to decline from 136.8 bcfd this week to 124.7 bcfd next week, further dampening market sentiment. The U.S. Energy Information Administration (EIA) reported a 321 billion cubic feet (bcf) withdrawal from storage for the week ending January 24, exceeding market expectations of 313 bcf. This drawdown erased the small gas surplus over the five-year average for the first time since January 2022. Storage levels are now 5.3% lower than last year and 4.1% below the five-year average. Looking ahead, the EIA projects record gas output and demand in 2025, with production reaching 104.5 bcfd and LNG exports increasing to 14.1 bcfd. Technically, natural gas is witnessing fresh selling, with open interest rising 16.35% to 17,602 contracts. Support is at 263.8, with a break below potentially testing Rs.258.6. Resistance is seen at Rs.277.7, and a move above this level could push prices toward Rs.286.4.
 

Trading Ideas:
* Naturalgas trading range for the day is 258.6-286.4.
* Natural gas fell as forecasts pointed to milder weather and weaker demand next week.
* US utilities withdrew 321 billion cubic feet (bcf) of natural gas from storage, reducing total inventories to 2,571 bcf.
* Storage levels are now 5.3% lower than the same period last year and 4.1% below the five-year average.


Copper
Copper prices edged up by 0.48% to Rs.832.5 as investors monitored the potential impact of new U.S. tariffs. Market sentiment remained cautious ahead of the February 1 deadline for the first round of U.S. tariffs on Chinese imports, including copper, amid concerns over global trade tensions. Meanwhile, China’s manufacturing activity unexpectedly contracted in January, adding uncertainty to demand prospects. With Chinese markets closed for the Lunar New Year holiday, trading volumes are expected to remain subdued. On the supply side, Freeport-McMoRan reported a decline in its fourth-quarter copper output and signaled lower production in Q1 2024. Chile also revised its long-term copper production forecast downward, expecting 5.54 million tons by 2034, compared to an earlier estimate of 6.34 million tons. Meanwhile, Antofagasta posted a modest 1% rise in 2024 copper production to 664,000 metric tons, below its initial guidance. The global refined copper market saw a growing deficit, with a shortfall of 131,000 metric tons in November, up from 30,000 metric tons in October, according to the International Copper Study Group (ICSG). However, for the first 11 months of 2023, the market remained in surplus by 168,000 metric tons. Technically, the market witnessed short covering as open interest declined by 1.9% to 6,210 contracts while prices gained Rs.3.95. Copper is currently finding support at Rs.828.3, with a break below potentially testing Rs.824.1. Resistance is at Rs.835.5, and a move above this level could push prices toward Rs.838.5.
 

Trading Ideas:
* Copper trading range for the day is 824.1-838.5.
* Copper gains as investors waited to see whether U.S. President Trump would following through with his threat to impose tariffs.
* Traders also adopted a cautious stance ahead of the February 1 deadline for the first round of US tariffs targeting China.
* Data showed that Chinese manufacturing activity unexpectedly contracted in January.


Zinc
Zinc prices edged up by 0.36% to Rs.267.25 as supply concerns provided support. Global mined zinc production declined for the third consecutive year in 2024, with China’s refined zinc output falling 7% due to lower processing rates. Additionally, production at Alaska’s Red Dog Mine, the world’s largest zinc mine, is expected to slow in 2025. Further support came from the continued decline in LME-registered warehouse inventories, which hit their lowest levels since February 2024. However, gains were capped as weak demand overshadowed supply constraints. China's manufacturing activity unexpectedly contracted in January, despite prior optimism that improved credit demand would boost industrial growth. Nevertheless, China’s industrial output showed strong acceleration in December, and credit aggregates indicated that the People’s Bank of China's monetary stimulus is starting to impact economic activity positively. Meanwhile, the global zinc market deficit narrowed to 52,900 metric tons in November from 65,400 metric tons in October, according to the International Lead and Zinc Study Group (ILZSG). For the first 11 months of 2024, the market saw a 33,000-ton deficit, contrasting with a 312,000-ton surplus in the same period of 2023. Technically, the market witnessed short covering as open interest declined by 5.71% to 3,387 contracts while prices gained Rs.0.95. Zinc is currently supported at Rs.265.1, with a break below possibly testing Rs.263. Resistance is at Rs.269.3, and a move above this level could push prices toward Rs.271.4.
 

Trading Ideas:
* Zinc trading range for the day is 263-271.4.
* Zinc gains amid supply concerns as global mined zinc production fell for the third consecutive year in 2024.
* However upside seen limited as the pessimistic demand backdrop momentarily outweighed the trend of lower supply.
* LME zinc total stocks were at the lowest since February 2024.


Aluminium
Aluminium prices inched up by 0.04% to Rs.252.1 as supply concerns continued to influence market sentiment. The European Commission proposed including Russian primary aluminium imports in its 16th package of sanctions, aiming to curb Moscow’s revenue sources. The proposed ban, which includes aluminium alloys, has a one-year phase-in period, with 275,000 metric tons exempted as "necessary" imports. Global primary aluminium output rose 3% year-on-year in December to 6.236 million tonnes, according to the International Aluminium Institute (IAI). Meanwhile, stocks at Japan’s three major ports increased 13.2% month-on-month to 323,600 metric tons. On the supply front, China produced a record 44 million tons of aluminium in 2024, nearing its government-mandated cap of 45 million tons. China’s unwrought aluminium exports rose by 17% year-on-year in the first ten months of 2024, reaching nearly 5.5 million tons. Additionally, December's aluminium production in China increased by 4.2% year-on-year to 3.77 million metric tons, driven by new capacity in Xinjiang. However, daily output fell 1.7% from November. Rising costs led Chinese aluminium producers to report average losses of 687 yuan per ton, marking the first industry-wide losses in three years, as per Antaike research. Technically, fresh buying was observed as open interest surged by 7.55% to 3,716 contracts, while prices gained Rs.0.1. Aluminium finds support at Rs.250.7, with further downside likely at Rs.249.3. Resistance is at Rs.253.4, and a breakout above could push prices toward Rs.254.7.
 

Trading Ideas:
* Aluminium trading range for the day is 249.3-254.7.
* Aluminium prices gained amid concerns over supply disruptions.
* The European Commission's proposal to ban Russian primary aluminium imports has fueled bullish sentiment.
* The official manufacturing PMI in China pointed to a sharp contraction in activity during January


Cottoncandy
Cottoncandy prices settled 0.47% higher at Rs.53,610, supported by a downward revision in Brazil’s 2024-25 cotton production forecast to 3.79 million tonnes from 3.83 million tonnes due to reduced acreage in Mato Grosso. However, the Cotton Association of India (CAI) has revised India's cotton crop projections upward by 2 lakh bales to 304.25 lakh bales, citing better-than-expected output in Telangana, where production is now seen at 42 lakh bales, up by 6 lakh bales. Despite the increase in India’s output, kapas arrivals in Punjab, Haryana, and Rajasthan have declined by 43% year-on-year, leading to supply constraints and raw material shortages for ginners and spinners. The latest WASDE report projected higher global production and ending stocks for 2024-25, pressuring prices. Global cotton output is expected to rise by 1.2 million bales to 117.4 million bales, driven by higher production in India and Argentina. However, strong export orders and rising demand from garment industries in South India are providing downside support. As per CAI, cumulative cotton arrivals stood at over 156 lakh bales by January 22, surpassing half of the estimated crop size. December-end stocks were estimated at 85.04 lakh bales, with consumption projections raised by 2 lakh bales to 315 lakh bales for 2024-25. Technically, the market is witnessing short covering as open interest remained unchanged at 253, while prices increased by Rs.250. Cottoncandy has support at Rs.52,030, with a potential test of Rs.50,440 on the downside. Resistance is seen at Rs.54,490, and a breakout could push prices toward Rs.55,360.
 

Trading Ideas:
* Cottoncandy trading range for the day is 50440-55360.
* Cotton gains as Brazil's 2024-25 cotton production forecast was revised down to 3.79 million tonnes
* CAI has revised upwards its crop projections by 2 lakh bales from its earlier estimates
* Global cotton production is projected to rise by more than 1.2 million bales to 117.4 million bales.
* In Rajkot, a major spot market, the price ended at 25264.4 Rupees dropped by -0.52 percent.


Turmeric
Turmeric fell 1.02% to Rs.13,638 due to weak demand and higher arrivals in major markets. Spot market arrivals nearly doubled to 13,190 bags from 6,780 bags in the previous session, with significant increases in Nizamabad and Hingoli. As harvesting progresses, maximum crop is expected to arrive within a month, keeping prices under pressure. However, lower yield expectations (10-15% drop) in key regions like Nanded, due to small rhizomes and crop rot, could support prices. Farmers have raised concerns over slow rhizome growth, indicating a potential production shortfall. On the trade front, turmeric exports from April to November 2024 surged 9.80% to 121,601.21 tonnes, compared to 110,745.34 tonnes in the same period last year. However, November exports dropped 20.18% to 12,721.25 tonnes from 15,938.21 tonnes in October. Despite this, exports rose 48.22% year-on-year from 8,582.44 tonnes in November 2023. Meanwhile, imports also surged 101.80% during April-November 2024 to 18,937.95 tonnes, though they declined 34.84% in November compared to October. The market witnessed fresh selling, with open interest rising 1.22% to 11,575 while prices declined Rs.140. Support is at Rs.13,522, with further downside possible to Rs.13,406. On the upside, resistance is at Rs.13,802, and a breakout could push prices toward Rs.13,966.
 

Trading Ideas:
* Turmeric trading range for the day is 13406-13966.
* Turmeric prices dropped on weak demand and marginal improvement in arrivals.
* With harvesting going well and maximum crop expected to arrive in a month.
* With the arrival of new crop likely to increase after Makar Sankranti, supply is expected to increase.
* In Nizamabad, a major spot market, the price ended at 13593.45 Rupees gained by 0.55 percent.


Jeera
Jeera rose 0.11% to Rs.21,805 on low-level buying and stock shortage, but the upside was limited due to weak demand and sufficient available stocks. Farmers still hold around 20 lakh bags, with only 3-4 lakh bags expected to be traded before the season ends, leaving a carry-forward stock of 16 lakh bags. Production for 2023-24 is estimated at 8.6 lakh tonnes, significantly higher than last year's 5.77 lakh tonnes, aided by better crop conditions and strong sowing. India’s cumin remains the cheapest globally, attracting buyers, including China. Indian cumin is priced at $3,050 per tonne, while Chinese cumin is $200-250 higher, making India the only viable option for bulk purchases. Additionally, geopolitical tensions in the Middle East over the past two months have boosted demand, benefiting exporters in Gujarat. Festive season demand from Europe and other global markets has also supported the market. Jeera exports from April-November 2024 surged 74.04% to 147,006.20 tonnes, compared to 84,467.16 tonnes in the previous year. However, November exports fell 28.92% to 11,555.56 tonnes from 16,257.44 tonnes in October, though they remained 42.67% higher year-on-year.  The market saw fresh buying, with open interest rising 0.12% to 2,487, while prices increased Rs.25. Support is at Rs.21,720, with further downside possible to Rs.21,640. On the upside, resistance is at Rs.21,910, and a breakout could push prices toward Rs.22,020.
 

Trading Ideas:
* Jeera trading range for the day is 21640-22020.
* Jeera gains on low level buying and amid shortage of stocks.
* However upside seen limited as demand is low and the current export business is being met from the available stock.
* The current season is expected to have similar production levels as last year due to better crop conditions and good sowing.
* In Unjha, a major spot market, the price ended at 22419.85 Rupees dropped by -0.09 percent.

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