Metals and Currencies Daily Market Watch August 19, 2015 - Emkay Commotrade-Shanghai Metals Market

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Metals and Currencies Daily Market Watch August 19, 2015 - Emkay Commotrade

Industry News 02:12:45PM Aug 19, 2015 Source:SMM

By Paul Ploumis 19 Aug 2015  Last updated at 02:45:39 GMT

Gold futures slightly retreated for a 10th day in the longest run of losses since 1996 as Goldman Sachs Group Inc. predicted further declines and investors sold more through funds.The metal dropped 6.1 percent as it fell every day since July 9 in New York.

Macro Headlines

•US housing starts rise to 1.21M highest level since October 2007 while building permits plunged than the earlier figures

•Chinese stocks plunged more than 6 percent on concern of further possibility of yuan weakness and Thailand bomb explosion

•UK Consumer prices increased by 0.1% in July from a year earlier and core measures of price growth increased to the highest in five months, pound jumped

•China property prices nationwide dropped by 3.7% in July from year earlier but prices rose 0.3% from June

•Rupee falls more than two year low against USD as U.S. Federal is likely to release minutes of its July 28-29 meeting 

Currencies

• USDINR: Indian rupee trading with lower openings today above Rs. 65.40 in spot market. FII outflow from local equity markets and dollar global strengths weakened rupee above 64.30. Yesterday currency markets in India remain closed due to public holiday. USDINR expected to move higher towards 66 only if prices likely to surpass the level of 65.50 in coming days. Buying on dips still is done until prices goes below 64.50 levels in spot market for near term.

• EURINR: The euro made good amount of rally in last week on Greece bailout sanctions from ECB. EURUSD increased above $1.110 against USD today. CFTC reported that euro short positions increased by 3.1% in last week. EURINR is expected to trade in range of 72.50-72.80 levels in coming days.

Commodities

 • Base Metals: In Base metals complex, Copper and aluminum futures slid to six-year lows for the second time in four days in London yesterday, the latest sign of market concern over Chinese demand at a time of worsening economic data in the world's second-biggest economy. US housing data also remained bearish for the counters. Aluminum remained solid among all the base metals last night as fell only 1% while other metals dropped 2-3%. Fears of slowing growth in China have been the main culprit behind the bear market in commodities over the last couple years. China housing market slump shows there would be some more corrections in the metals especially copper. Metals today likely to trade under pressure as there is no sign of stimulus to be expected from China government in near term secondly lack of fundamental trigger in the market not lending support to price for falling further. Copper expected to take support of 327 while Nickel at 660, aluminum unlikely to fall below 98.50 while Zinc and lead further reduction is still possible.

Global Economic Events

Event     Country     Time (IST)     Estimates    

Trade Balance    Japan    05.20 am    -0.16T    

Current Account    Euro Zone    01.30pm    19.2B    

CPI (MoM)    US    06.00 pm    0.2%    

FOMC meeting minuets    US    11:30 pm    Nil    

Precious Metals: Gold steadied at $1117 but silver eased 3% on stronger dollar last night increased 0.2% above 97 levels. US housing data posted highest levels in more than 8 years yesterday which remained bearish for bullions. The bearish trend in gold reversed in last week after China devalued the yuan by 1.9% and Greece entered into a bailout agreement with its international creditors. Uncertainty over the timing of the rate hike from US Federal reserve in September is supporting gold prices at present. Today Comex gold for December delivery fell 0.02% to $1,116.70 a troy ounce and Silver for September delivery rose 0.30 to $14.835 a troy ounce. Gold is expected to trade in range of $1090-$1130 in coming days, Silver surpassed the level of $15 thus upside cap becomes $15.50. Today FOMC is likely to reveal its minuets of meeting held on July 28-29. Thus huge volatility in bullions today remains in accordance with rate hike expectations in September meeting.

Energy: In the initial trading crude oil prices fell in US towards six-year lows on yesterday after stock markets tumbled in China, the world's largest energy consumer, adding to worries about global fuel demand at a time of heavy oversupply. Later on prices recovered on the release of the American Petroleum Institute said that crude stocks dropped 2.3 million barrels last week, more than the 2.0 million barrel drop seen, with data on refined products not immediately available. Chinese stocks fell more than 6 percent yesterday as the yuan weakened against the dollar, raising fears that Beijing may further devalue the currency. U.S. crude futures were 20 cents weaker at $41.67 a barrel and Brent was at $48.54 a barrel, down 20 cents but still some way from its 2015 low of $45.19. Crude managed to rise above $42 levels off late on reduction of stocks and CITI bullish comment on oil buying. Crude just like done earlier taking good support of $40, thus there would be some if prices don’t fall below $40 in coming days. Gas is not above to sustain on higher side moderate weather conditions in US likely to add more supply glut in the market. Gas expected to take support of 177-175 levels ahead of EIA stocks report. FOMC meeting minutes remains crucial to bring trading move in the picture.

LME Warehouse Updates (in ton)

Metals    Total
Inventories    Cancelled
Warrants
(CW)    Change in
Stocks    Change in
CW    CW % of
Total
Inventory    Remarks    

Aluminum    -10025    3335575    100    1331700    39.92    CW ratio started improving    

Copper    2950    353600    950    26425    7.47    Stocks falls more than 1.4%    

Nickel    156    454974    1512    150648    33.11    Stocks fallen very sharply from highest levels in record    

Lead    -2275    201425    750    42725    21.21    Cancelled warrants 3.8% in last week    

Zinc    39975    502900    0    68750    13.67    Stockpiles in Antwerp double to highest since Feb 14    

Trend Watch

MCX     Resistance     Support     Comments    

Gold     26325    25700    Major correction only below 25700. Until then dips will find buying support.    

Silver     35550    34000    Sell on rise. Can slide towards 34000 levels.    

Crude oil     2855    2640    Failure to sustain above 2800 will see prices dip towards 2720 again.    

Copper     336.50    327    Further fall only below 327. Until then prices will consolidate and rebound.    

Nickel    700    670    Failure to break below 670 will see prices rebound towards 700 levels.    

Zinc     118.50    113.40    Counter can re-test 113.40 over the coming sessions.    

Lead     112    108    Pullbacks will face selling around 111.60—112. Prices can dip towards 108 levels.    

Natural Gas    181    174.50    Reversal only above 181. Until then prices will slip towards 175 levels.    

Courtesy : Emkay Commotrade


Metals and Currencies Daily Market Watch August 19, 2015 - Emkay Commotrade

Industry News 02:12:45PM Aug 19, 2015 Source:SMM

By Paul Ploumis 19 Aug 2015  Last updated at 02:45:39 GMT

Gold futures slightly retreated for a 10th day in the longest run of losses since 1996 as Goldman Sachs Group Inc. predicted further declines and investors sold more through funds.The metal dropped 6.1 percent as it fell every day since July 9 in New York.

Macro Headlines

•US housing starts rise to 1.21M highest level since October 2007 while building permits plunged than the earlier figures

•Chinese stocks plunged more than 6 percent on concern of further possibility of yuan weakness and Thailand bomb explosion

•UK Consumer prices increased by 0.1% in July from a year earlier and core measures of price growth increased to the highest in five months, pound jumped

•China property prices nationwide dropped by 3.7% in July from year earlier but prices rose 0.3% from June

•Rupee falls more than two year low against USD as U.S. Federal is likely to release minutes of its July 28-29 meeting 

Currencies

• USDINR: Indian rupee trading with lower openings today above Rs. 65.40 in spot market. FII outflow from local equity markets and dollar global strengths weakened rupee above 64.30. Yesterday currency markets in India remain closed due to public holiday. USDINR expected to move higher towards 66 only if prices likely to surpass the level of 65.50 in coming days. Buying on dips still is done until prices goes below 64.50 levels in spot market for near term.

• EURINR: The euro made good amount of rally in last week on Greece bailout sanctions from ECB. EURUSD increased above $1.110 against USD today. CFTC reported that euro short positions increased by 3.1% in last week. EURINR is expected to trade in range of 72.50-72.80 levels in coming days.

Commodities

 • Base Metals: In Base metals complex, Copper and aluminum futures slid to six-year lows for the second time in four days in London yesterday, the latest sign of market concern over Chinese demand at a time of worsening economic data in the world's second-biggest economy. US housing data also remained bearish for the counters. Aluminum remained solid among all the base metals last night as fell only 1% while other metals dropped 2-3%. Fears of slowing growth in China have been the main culprit behind the bear market in commodities over the last couple years. China housing market slump shows there would be some more corrections in the metals especially copper. Metals today likely to trade under pressure as there is no sign of stimulus to be expected from China government in near term secondly lack of fundamental trigger in the market not lending support to price for falling further. Copper expected to take support of 327 while Nickel at 660, aluminum unlikely to fall below 98.50 while Zinc and lead further reduction is still possible.

Global Economic Events

Event     Country     Time (IST)     Estimates    

Trade Balance    Japan    05.20 am    -0.16T    

Current Account    Euro Zone    01.30pm    19.2B    

CPI (MoM)    US    06.00 pm    0.2%    

FOMC meeting minuets    US    11:30 pm    Nil    

Precious Metals: Gold steadied at $1117 but silver eased 3% on stronger dollar last night increased 0.2% above 97 levels. US housing data posted highest levels in more than 8 years yesterday which remained bearish for bullions. The bearish trend in gold reversed in last week after China devalued the yuan by 1.9% and Greece entered into a bailout agreement with its international creditors. Uncertainty over the timing of the rate hike from US Federal reserve in September is supporting gold prices at present. Today Comex gold for December delivery fell 0.02% to $1,116.70 a troy ounce and Silver for September delivery rose 0.30 to $14.835 a troy ounce. Gold is expected to trade in range of $1090-$1130 in coming days, Silver surpassed the level of $15 thus upside cap becomes $15.50. Today FOMC is likely to reveal its minuets of meeting held on July 28-29. Thus huge volatility in bullions today remains in accordance with rate hike expectations in September meeting.

Energy: In the initial trading crude oil prices fell in US towards six-year lows on yesterday after stock markets tumbled in China, the world's largest energy consumer, adding to worries about global fuel demand at a time of heavy oversupply. Later on prices recovered on the release of the American Petroleum Institute said that crude stocks dropped 2.3 million barrels last week, more than the 2.0 million barrel drop seen, with data on refined products not immediately available. Chinese stocks fell more than 6 percent yesterday as the yuan weakened against the dollar, raising fears that Beijing may further devalue the currency. U.S. crude futures were 20 cents weaker at $41.67 a barrel and Brent was at $48.54 a barrel, down 20 cents but still some way from its 2015 low of $45.19. Crude managed to rise above $42 levels off late on reduction of stocks and CITI bullish comment on oil buying. Crude just like done earlier taking good support of $40, thus there would be some if prices don’t fall below $40 in coming days. Gas is not above to sustain on higher side moderate weather conditions in US likely to add more supply glut in the market. Gas expected to take support of 177-175 levels ahead of EIA stocks report. FOMC meeting minutes remains crucial to bring trading move in the picture.

LME Warehouse Updates (in ton)

Metals    Total
Inventories    Cancelled
Warrants
(CW)    Change in
Stocks    Change in
CW    CW % of
Total
Inventory    Remarks    

Aluminum    -10025    3335575    100    1331700    39.92    CW ratio started improving    

Copper    2950    353600    950    26425    7.47    Stocks falls more than 1.4%    

Nickel    156    454974    1512    150648    33.11    Stocks fallen very sharply from highest levels in record    

Lead    -2275    201425    750    42725    21.21    Cancelled warrants 3.8% in last week    

Zinc    39975    502900    0    68750    13.67    Stockpiles in Antwerp double to highest since Feb 14    

Trend Watch

MCX     Resistance     Support     Comments    

Gold     26325    25700    Major correction only below 25700. Until then dips will find buying support.    

Silver     35550    34000    Sell on rise. Can slide towards 34000 levels.    

Crude oil     2855    2640    Failure to sustain above 2800 will see prices dip towards 2720 again.    

Copper     336.50    327    Further fall only below 327. Until then prices will consolidate and rebound.    

Nickel    700    670    Failure to break below 670 will see prices rebound towards 700 levels.    

Zinc     118.50    113.40    Counter can re-test 113.40 over the coming sessions.    

Lead     112    108    Pullbacks will face selling around 111.60—112. Prices can dip towards 108 levels.    

Natural Gas    181    174.50    Reversal only above 181. Until then prices will slip towards 175 levels.    

Courtesy : Emkay Commotrade