Metals and Currencies Daily Market Watch August 26, 2015 - Emkay Commotrade-Shanghai Metals Market

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Metals and Currencies Daily Market Watch August 26, 2015 - Emkay Commotrade

Industry News 04:43:29PM Aug 26, 2015 Source:SMM

By  Paul Ploumis 26 Aug 2015  Last updated at  03:44:34 GMT

Macro Headlines

• New-home sales rose by 5.4% in July to 507,000, another sign of a steadily firming housing market, missing the forecast of 512K

• US CB consumer confidence jumps to 7 months high in August while service PMI at 55.2, expanded at slower pace in August

• Germany business sentiments at 108.3 in August beating the estimates of 107.5 and previous 108

• China PBOC cuts interest rates, bank reserve requirement ratio; tentative signs of stability in global markets

• China Premier: No foundation for long-term yuan depreciation

• Gold prices fell back below $1150 as China moves calms markets

Currencies

• USDINR: The rupee recovered from two years low by 50 bps to Rs.66 levels in spot after China rate cut decision improved sentiments of global markets including Indian equities. FII outflow pressurized rupee to fall sharply by more than 2% in last two days, RBI intervened at 66.70 levels yesterday. Dollar index also stabilized around 93 levels on downbeat of US economic data. Today we may see some range trading activity in the level of 65.90-66.50 levels. An overall rupee outlook remains bearish towards 66.50-67.50 levels only if RBI not takes any aggressive stance to curb FX volatility.

• EURINR: The euro is trading up 1.6% at $1.1560 as the greenback suffered from waning expectations of a Fed rate hike in September and unwinding of euro-funding carry trade. Euro rebounded very sharply along with other pairs like yen and GBP against INR yesterday. EURINR expected to rebound to 77-77.50 levels in near term.

Commodities

Base Metals: Base metals recovered on LME off late as China introduced rate cuts to stimulate growth yesterday but later n looking to US equities and sharp decline of China equities added furthermore weakness as demand from major consumer nations is affecting. Despite the fall in US dollar metals went to slide into oversold zone. LME three-month copper contract was down 2% at $4,953 a metric ton, tumbled to its lowest level since 2009 earlier in trading at $4,855 a ton. It fell below the key $5,000 level for the fifth-straight session. Aluminum, meanwhile, closed down 1.7% at $1,521.50 a ton, after hitting a six-year low during trading at $1,506 a ton. Today there will be some corrections or stable range trading expected on China stimulus but overall weakness still remains until any other intrinsic fundamental trigger comes.

Global Economic Events

Event

Country

Time (IST)

Estimates

SPPI (YoY)Japan5.20am0.4%
CBI realized salesUK0 3 . 3 0 p m19
Durable goods ordersUS06.00 pm0.3%

 Precious Metals: Bullions calmed in the initial trading today as China slowdown fear have eased after the rate cut decision by Chinese government has introduced. Gold prices fell back to the level of $1140 ounce and silver fell below $15 again. Earlier prices rose closing at their highest level in seven weeks, on safe heaven bid offered investors who sought to shield their wealth from turbulence in global stocks and currency markets on China concerns. That was the highest close since July 2. Investors often buy gold in times of political and economic uncertainty in the belief it will keep its value better than such assets as stocks, bonds and currencies. Spot gold rose trading lower 3 cents to $1136 troy ounce and silver down $1 at $14.55 troy ounce. One can take long position in gold until prices closes below 26400 levels, COMEX upside limit is at $1200 for this week but overall the Jackson Hole symposium due later this week remains crucial for further direction.

Energy: Crude oil prices hovering below $40 barrel, at more than six years low in US after China's central bank moved to support the country's stumbling economy, while concerns about a supply glut capped gains.WTI prices closed lower to $39.50 levels in US but dollar weaknesses against rupee supported the sentiments. Meanwhile higher than expected US housing data supported the sentiments for oil. U.S. crude stocks fell by 7.3 million barrels last week to 449.3 million, compared with analysts' expectations for a rise of 1 million barrels as refinery runs rose, data from the American Petroleum Institute showed on Tuesday. Energy Information Administration data is due on Wednesday. Though there will be some rebound in the prices on China stimulus or technical pullback after massive fall but overall weaknesses still remains until prices goes above 2800 levels or $41.50 in coming days. Selling on rise is still to be suggested. Gas prices are likely to fluctuate in between the range of Rs.175-181 levels on moderate weather conditions in US and ahead of EIA stocks release. Buying on dips on daily basis can be done for intraday.

LME Warehouse Updates (in ton)

MetalsTotal
Inventories
Cancelled
Warrants
(CW)
Change in
Stocks
Change in
CW
CW % of
Total
Inventory
Remarks
Aluminum-820033039502925129142539.09CW ratio started improving from the lowest pace
Copper-65035555021255370015.1Canceled warrants jump 36% to highest since July 14
Nickel-1200453852990016371036.07Stocks have fallen very sharply from highest levels in
record
Lead-18751907752504562523.92Cancelled warrants 26% in the last week
Zinc28005255509007602514.47Stockpiles in Antwerp double to highest since Feb 14

Trend Watch

MCXResistanceSupportComments
Gold2759026400The correction can extend towards 26400 over the coming sessions.
Silver3560033900Sustenance below 34400 will see prices dip towards 33900.
Crude oil27602577Negative view until prices stay below 2760. Sell on rise.
Copper342.50326Failure to sustain between 342—340 will see prices dip towards 330 again.
Nickel655.50618Sustenance above 645 will see prices rebound towards 655.50.
Zinc117.50113Negative view until prices stay below 116.25 levels.
Lead115107.30Sideways between 113.25—108 levels
Natural Gas185.50174Sideways between 185—174. A dip towards 174 is likely.
USDINR66.7065.70Further dip towards 65.70/65.60 likely. But prices can rebound from lower levels.

Courtesy : Emkay Commotrade

Emkay Commotrade Ltd.

7th Floor, The Ruby, Senapati Bapat Marg, Dadar - West, Mumbai - 400028. 

India Tel: +91 22 66121212 Fax: +91 22 66121299


 


Relative News

Price

more
SMM #1 Nickel
Oct.18
131000.0
-500.0
(-0.38%)
#1 JinChuan Nickel
Oct.18
131150.0
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130850.0
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JinChuan B&C
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(46.77%)
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4350.0
1400.0
(47.46%)

Metals and Currencies Daily Market Watch August 26, 2015 - Emkay Commotrade

Industry News 04:43:29PM Aug 26, 2015 Source:SMM

By  Paul Ploumis 26 Aug 2015  Last updated at  03:44:34 GMT

Macro Headlines

• New-home sales rose by 5.4% in July to 507,000, another sign of a steadily firming housing market, missing the forecast of 512K

• US CB consumer confidence jumps to 7 months high in August while service PMI at 55.2, expanded at slower pace in August

• Germany business sentiments at 108.3 in August beating the estimates of 107.5 and previous 108

• China PBOC cuts interest rates, bank reserve requirement ratio; tentative signs of stability in global markets

• China Premier: No foundation for long-term yuan depreciation

• Gold prices fell back below $1150 as China moves calms markets

Currencies

• USDINR: The rupee recovered from two years low by 50 bps to Rs.66 levels in spot after China rate cut decision improved sentiments of global markets including Indian equities. FII outflow pressurized rupee to fall sharply by more than 2% in last two days, RBI intervened at 66.70 levels yesterday. Dollar index also stabilized around 93 levels on downbeat of US economic data. Today we may see some range trading activity in the level of 65.90-66.50 levels. An overall rupee outlook remains bearish towards 66.50-67.50 levels only if RBI not takes any aggressive stance to curb FX volatility.

• EURINR: The euro is trading up 1.6% at $1.1560 as the greenback suffered from waning expectations of a Fed rate hike in September and unwinding of euro-funding carry trade. Euro rebounded very sharply along with other pairs like yen and GBP against INR yesterday. EURINR expected to rebound to 77-77.50 levels in near term.

Commodities

Base Metals: Base metals recovered on LME off late as China introduced rate cuts to stimulate growth yesterday but later n looking to US equities and sharp decline of China equities added furthermore weakness as demand from major consumer nations is affecting. Despite the fall in US dollar metals went to slide into oversold zone. LME three-month copper contract was down 2% at $4,953 a metric ton, tumbled to its lowest level since 2009 earlier in trading at $4,855 a ton. It fell below the key $5,000 level for the fifth-straight session. Aluminum, meanwhile, closed down 1.7% at $1,521.50 a ton, after hitting a six-year low during trading at $1,506 a ton. Today there will be some corrections or stable range trading expected on China stimulus but overall weakness still remains until any other intrinsic fundamental trigger comes.

Global Economic Events

Event

Country

Time (IST)

Estimates

SPPI (YoY)Japan5.20am0.4%
CBI realized salesUK0 3 . 3 0 p m19
Durable goods ordersUS06.00 pm0.3%

 Precious Metals: Bullions calmed in the initial trading today as China slowdown fear have eased after the rate cut decision by Chinese government has introduced. Gold prices fell back to the level of $1140 ounce and silver fell below $15 again. Earlier prices rose closing at their highest level in seven weeks, on safe heaven bid offered investors who sought to shield their wealth from turbulence in global stocks and currency markets on China concerns. That was the highest close since July 2. Investors often buy gold in times of political and economic uncertainty in the belief it will keep its value better than such assets as stocks, bonds and currencies. Spot gold rose trading lower 3 cents to $1136 troy ounce and silver down $1 at $14.55 troy ounce. One can take long position in gold until prices closes below 26400 levels, COMEX upside limit is at $1200 for this week but overall the Jackson Hole symposium due later this week remains crucial for further direction.

Energy: Crude oil prices hovering below $40 barrel, at more than six years low in US after China's central bank moved to support the country's stumbling economy, while concerns about a supply glut capped gains.WTI prices closed lower to $39.50 levels in US but dollar weaknesses against rupee supported the sentiments. Meanwhile higher than expected US housing data supported the sentiments for oil. U.S. crude stocks fell by 7.3 million barrels last week to 449.3 million, compared with analysts' expectations for a rise of 1 million barrels as refinery runs rose, data from the American Petroleum Institute showed on Tuesday. Energy Information Administration data is due on Wednesday. Though there will be some rebound in the prices on China stimulus or technical pullback after massive fall but overall weaknesses still remains until prices goes above 2800 levels or $41.50 in coming days. Selling on rise is still to be suggested. Gas prices are likely to fluctuate in between the range of Rs.175-181 levels on moderate weather conditions in US and ahead of EIA stocks release. Buying on dips on daily basis can be done for intraday.

LME Warehouse Updates (in ton)

MetalsTotal
Inventories
Cancelled
Warrants
(CW)
Change in
Stocks
Change in
CW
CW % of
Total
Inventory
Remarks
Aluminum-820033039502925129142539.09CW ratio started improving from the lowest pace
Copper-65035555021255370015.1Canceled warrants jump 36% to highest since July 14
Nickel-1200453852990016371036.07Stocks have fallen very sharply from highest levels in
record
Lead-18751907752504562523.92Cancelled warrants 26% in the last week
Zinc28005255509007602514.47Stockpiles in Antwerp double to highest since Feb 14

Trend Watch

MCXResistanceSupportComments
Gold2759026400The correction can extend towards 26400 over the coming sessions.
Silver3560033900Sustenance below 34400 will see prices dip towards 33900.
Crude oil27602577Negative view until prices stay below 2760. Sell on rise.
Copper342.50326Failure to sustain between 342—340 will see prices dip towards 330 again.
Nickel655.50618Sustenance above 645 will see prices rebound towards 655.50.
Zinc117.50113Negative view until prices stay below 116.25 levels.
Lead115107.30Sideways between 113.25—108 levels
Natural Gas185.50174Sideways between 185—174. A dip towards 174 is likely.
USDINR66.7065.70Further dip towards 65.70/65.60 likely. But prices can rebound from lower levels.

Courtesy : Emkay Commotrade

Emkay Commotrade Ltd.

7th Floor, The Ruby, Senapati Bapat Marg, Dadar - West, Mumbai - 400028. 

India Tel: +91 22 66121212 Fax: +91 22 66121299