Commodities Daily Report
Monday, October 20, 2014
International Commodities
Content
Overview
Precious Metals
Energy
Base Metals
Important Events for today
Research Team
Prathamesh Mallya
Sr. Research Analyst
[email protected]
(022) 2921 2000 Extn :6134
Anish Vyas
Research Analyst
[email protected]
(022) 2921 2000 Extn :6104
Kaynat Chainwala
Research Associate
[email protected]
(022) 2921 2000 Extn :6136
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Commodities Daily Report
Monday, October 20, 2014
International Commodities
Overview
US Building Permits was at 1.02 million in the month of September.
LME Copper stocks jump by a whopping 5.3 percent last week.
UK’s Right move HPI gained by 2.6 percent in the current month.
Gold imports in India nearly doubled in Sept’14 to $3.75 bn.
US Prelim UoM Consumer Sentiment rose to 86.4-mark in October.
Asian markets are trading on a positive note today on the back of
favorable economic data from the US on Friday which showed signed of
progress in world’s largest economy.
The US Dollar Index (DX) traded on a negative note and declined around
1 percent in the last week on the back of statement from central bank
officials stating that central bank need to consider with delaying of its
final round of QE tapering.
On a weekly basis, The Indian Rupee appreciated marginally around 0.1
percent. The currency appreciated on the back of sharp plunge in retail
and wholesale inflation data from the country during the week. Further,
Reserve Bank of India (RBI) intervening the markets and selling dollars at
62-mark continued with positive movement in the currency.
Market Highlights (% change)
as on October 17, 2014
Last
Prev day
w-o-w
m-o-m
y-o-y
INR/$
(Spot)
61.35
0.8
-0.6
-0.4
-0.4
$/Euro
(Spot)
1.2761
-0.4
0.1
-1.4
-6.7
Dollar
Index
85.21
0.2
-0.6
0.4
7.2
NIFTY
7779.7
0.4
-1.3
-3.3
29.2
SENSEX
26108.5
0.4
-1.0
-2.6
42.8
DJIA
16380.4
1.6
-1.0
-4.6
6.4
S&P
1886.8
1.3
-1.0
-5.7
8.9
NEWS & DEVELOPMENTS
Jobless claims in the US fall to 14 year low
Returns from U.S. bonds are closely watched by the gold market, given
that the metal pays no interest. Data on Thursday showed U.S. jobless
claims fell to a 14-year low last week and that industrial output rose
sharply in September.
PH clears way for Marcventures' expanded nickel mining
In other news, the London Metal Exchange, owned by Hong Kong
Exchanges and Clearing Ltd, will take charge of London's platinum and
palladium pricing, also known as "fixes", from Dec. 1, replacing a
teleconference with an electronic platform.
Marcventures Holdings Inc., one of the Philippines' biggest
nickel miners, has won government approval to expand its
mining operations, helping it to ramp up ore exports to top
buyer China, the company said on Friday.
The average price of a gallon of gasoline in the United States dropped 12
cents in the past three weeks to its lowest point in nearly a year, driven
by the latest round of falling oil prices, according to the Lundberg survey
released on Sunday.
The decision by the Mines and Geosciences Bureau (MGB) will
allow Marcventures to extract ore from a 4,799-hectare area in
Surigao del Sur province in Mindanao, moving beyond its
current 300-hectare site, the company said in a statement to
Manila's stock exchange.
Source: Reuters
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Commodities Daily Report
Monday, October 20, 2014
International Commodities
Bullion
Gold
Spot gold prices traded positive last week as decline in global equities
followed by disappointing economic data from the US, sparking economic
fears and lifting gold’s safe haven appeal.
US equities traded lower after the U.S. government said retail sales slipped
in September and producer prices fell, worrisome signals on the
economy's health that heightened financial market worries over faltering
global growth.
Economic data from Europe has remained weak and a worse-thanexpected inflation reading from China weighed on gold, an inflation hedge.
Gold took some support from physical markets. Gold imports in India, the
world's second-biggest consumer of the metal, nearly doubled in
September from August to $3.75 billion, ahead of the country's wedding
and festival season.
In the international markets, spot gold prices gained by 1.2 percent and
closed at $1237.69/oz. On the MCX, gold prices gained by 1.08 percent
and closed at Rs.27256/10gms.
Silver
Spot silver prices in the international markets declined diverging from
gains in gold prices. Although, dollar index lost its value by around 1
percent, weakness in Nickel prices acted as a negative factor for prices.
Spot silver prices in the international markets declined by 0.63 percent and
closed at $17.23/oz. On the MCX, silver prices declined by 0.29 percent
taking cues from weak international markets and closed at Rs.38399/kg.
Market Highlights - Gold (% change)
Gold
Unit
Last
Gold (Spot)
$/oz
Gold (Spot
-Mumbai)
Rs/10
gms
27300.0
Comex
Gold
(Oct’14)
$/oz
MCX Gold
(Oct’14)**
Rs /10
gms
as on October 17, 2014
Prev.
day
-0.08
MoM
YoY
0.1
0.4
-6.2
0.74
1.5
1.7
-8.4
1235.4
-0.23
0.5
1.2
-6.6
27256.0
-0.70
1.1
1.0
-7.7
1237.7
WoW
Source: Reuters
Market Highlights - Silver (% change)
Silver
Unit
Silver
(Spot)
$/oz
Silver
(Spot Mumbai)
Comex
Silver
(Sep’14)
MCX Silver
(Dec’14)**
Rs/1 kg
$/ oz
Rs / kg
as on October 17, 2014
Last
Prev day
WoW
MoM
YoY
17.2
-0.5
-1.3
-7.2
-21.1
39300.0
-0.9
0.1
-6.0
-28.2
#N/A
#N/A
#N/A
#N/A
#N/A
17.4
-0.2
0.8
-1.8
-20.6
Source: Reuters
Technical Chart – Spot Gold
Outlook
On an intraday basis, we expect gold and silver prices to trade sideways as
comments from James Bullard to continue with the bond buying
programme indicates that it Fed needs to do more to bring the US
economy out of the woods. On the contrary, the economic data released
from US paints a bright picture about the country exerting downside
pressure on prices.
On the MCX, the precious metals pack is expected to trade sideways taking
cues from international markets.
Source: Reuters
Technical Outlook
valid for October 20, 2014
Unit
Spot Gold
MCX Gold Oct’14
MCX Silver Dec’14
NCDEX Silver hedge Sep’14
Resistance
$/oz
1229/1224
1240/1247
Rs/10
gms
27100/27000
27350/27500
24350/24260
24580/24710
$/oz
17.10/16.90
17.40/17.60
Rs/kg
38000/37700
38600/38900
3430/3410
3490/3520
NCDEX Gold hedge Nov’14
Spot Silver
Support
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Commodities Daily Report
Monday, October 20, 2014
International Commodities
Energy
Crude Oil
Market Highlights - Crude Oil (% change)
WTI oil prices traded lower last week extending a run of losses on
concerns over weak oil demand as equity markets tumbled and
economic gloom spread. Concerns over growing oil supply, falling global
equities exerted downside pressure.
Crude Oil
Growth concern in global economy, slow demand from Asia, inventory
buildup in the US further added pressure. A downward revision in global
oil demand for 2015 by the International Energy Agency further
depressed the market.
Unit
Last
Brent
(Spot)
Nymex
Crude (Sep
’14)
ICE Brent
Crude
(Oct’14)
$/bbl
85.3
Prev.
day
2.4
$/bbl
82.8
$/bbl
MCX Crude
(Oct ’14)
Rs/bbl
as on October 17, 2014
WoW
MoM
YoY
-2.8
-11.4
-22.4
0.1
-3.6
-9.6
-17.8
86.2
2.0
-3.1
-10.9
-21.0
5095.0
-0.3
-2.4
-10.1
-17.1
Source: Reuters
WTI oil prices in the international markets declined by 3.58 percent and
closed at $82.75/bbl. On the MCX, crude prices declined by 3.58 percent
taking cues from weak international markets and closed at Rs.5095/bbl.
Market Highlights - Natural Gas (% change)
Natural
Gas (NG)
CFTC
The Commodity Futures Trading Commission (CFTC) Commitments of
Traders report in the week to 7th October showed that bullish bets on
crude oil declined 11361 contracts to 179839 contracts, down by 5.94
percent.
Nymex
NG
MCX NG
(Oct’14)
as on October 17, 2014
Unit
Last
Prev. day
WoW
MoM
YoY
$/mmbtu
3.85
-1.03
-3.41
-2.83
-0.77
230.90
-1.58
-2.90
-3.87
0.61
Rs/
mmbtu
Source: Reuters
Technical Chart – NYMEX Crude Oil
Outlook
On an intraday basis, we expect crude oil prices to trade lower as ample
supplies coupled with the ongoing refinery maintenance season in the
US will act as a negative factor for prices. Concerns over slowdown in
the Chinese economy will further drag prices.
On the MCX, crude oil prices are expected to trade lower taking cues
from weak international markets.
Source: Reuters
Technical Outlook
valid for October 20, 2014
Unit
Support
Resistance
NYMEX Crude Oil
$/bbl
82.40/81.60
83.70/84.50
MCX Crude Oct’14
Rs/bbl
5050/5000
5130/5190
NCDEX Crude Oct’14
Rs/bbl
5060/5014
5140/5190
Technical Chart – NYMEX Natural Gas
Source: Reuters
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Commodities Daily Report
Monday, October 20, 2014
International Commodities
Base Metals
Base metals on the LME traded lower last week China reported the
slowest consumer inflation in more than four years, indicating that
demand for the metal is weakening in the world’s biggest consumer.
Also, mixed economic data from the US along with gain in LME stocks
exerted downside pressure on prices.
Market Highlights - Base Metals (% change)
Unit
LME Copper (3
Last
as on October 17, 2014
Prev. day
WoW
MoM
YoY
$/tonne
6629.5
0.6
-1.6
-2.9
-8.4
Rs/kg
409.3
0.1
-1.0
-3.1
-8.6
$/tonne
1965.0
2.0
1.0
-1.6
6.1
Rs /kg
121.0
1.8
1.9
-0.8
7.3
15695.0
0.9
-4.9
-13.3
12.2
Rs /kg
960.8
0.2
-4.4
-13.1
12.6
$/tonne
2032.5
2.2
-1.8
-3.3
-6.4
Rs /kg
124.2
1.5
-1.5
-3.0
-5.7
$/tonne
2252.0
0.8
-3.5
-0.2
16.8
Rs /kg
138.1
0.2
-2.9
0.2
18.9
month)
However, faster exports eased concern that economic growth will
fade in China, the world’s biggest consumer. Chinese customs figures
showed shipments abroad climbed 15 percent from a year earlier last
month while Imports, projected to drop, gained 7 percent restricted
sharp upside in prices.
MCX Copper
In the Indian markets, base metals traded on a negative note last
week in line with weakness in the international markets.
(Oct’14)
(Nov’14)
LME Aluminum
(3 month)
MCX Aluminum
$/tonne
LME Nickel
(3 month)
Copper
MCX Nickel
LME Copper prices plunged by 1.6 percent last week to their lowest
levels in six months as signs of muted inflation signaled lower metal
demand in the two biggest consumers, China and the US. Further,
whopping gain of 5.3 percent in LME copper stocks acted as a negative
factor.
(Oct’14)
However, the People’s Bank of China told financial executives last
week that it plans to extend as much as 200 billion yuan ($32.8 billion)
in short-term loans to 20 large banks, with the goal of spurring lending
activity and boosting growth. The move comes on the heels of a cut to
short-term borrowing rates for Chinese banks on Oct. 14, the second
such reduction in less than a month. These efforts restricted further
downside in prices. The red metal closed at $6629.5/tonne in the last
session.
LME Zinc
LME Lead
(3 month)
MCX Lead
(Oct’14)
(3 month)
MCX Zinc
(Oct’14)
Source: Reuters
LME Inventories
Unit
17th October
16th October
Actual
Change
(%)
Change
Copper
tonnes
157825
157675
150
0.10%
In the Indian markets, copper prices plunged by 1 percent and closed
at Rs.409.3/kg on Friday.
Aluminum
tonnes
4517475
4526050
-8575
-0.19%
Nickel
tonnes
375492
374562
930
0.25%
Outlook
Zinc
tonnes
723150
724775
-1625
-0.22%
Lead
tonnes
225050
225550
-500
-0.22%
From the intra-day perspective, we expect copper prices to trade
lower today the global copper market is expected to record larger
surplus next year as demand in China; the world's largest consumer of
the metal slows sharply. Also, worries over the end of U.S. monetary
stimulus and rising stocks will act as negative factors.
Source: Reuters
Technical Chart – LME Copper
On the MCX, Copper prices will trade lower taking cues from
international markets.
Technical Outlook
valid for October 20, 2014
MCX Copper Nov’14
Unit
Rs /kg
Support
406/404
Resistance
412/415
MCX Zinc Oct’14
Rs /kg
137/136
139/140
MCX Lead Oct’14
Rs /kg
123.20/122.20
125.20/126.20
MCX Aluminum Oct’14
Rs /kg
119.50/118.50
121/122
MCX Nickel Oct’14
Rs /kg
950/940
970/980
Source: Reuters
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Commodities Daily Report
Monday, October 20, 2014
International Commodities
Important Events for Today
Indicator
German Buba Monthly Report
Country
Time (IST)
Euro
3:30pm
Actual
-
Forecast
-
Previous
-
Impact
Medium
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