Metals and Currencies Daily Market Watch Sept 01, 2015 - Emkay Commotrade-Shanghai Metals Market

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Metals and Currencies Daily Market Watch Sept 01, 2015 - Emkay Commotrade

Industry News 04:47:28PM Sep 01, 2015 Source:SMM

By  Paul Ploumis 01 Sep 2015  Last updated at 03:22:50 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 Yor

Macro Headlines

• China's official manufacturing PMI for August fell to 49.7, from 50.0 in July, lowest level in three years while Missing forecast Caixin PMI posted at 47.3 the lowest point in more than six years

• Fed policy makers speaking in Jackson Hole, over the weekend sticked to its plan to raise rates before the end of the year despite the recent pronounced swings in global markets

• Annual inflation in the euro zone steadied at 0.2% in August as in July, defying economists' expectations of a slowdown

• Oil spiked as EIA reported fall in output in June by 1.1% and OPEC said it was "ready to talk" to producers about multi-year low prices. 

Currencies

• USDINR: The rupee opened down against the US dollar with extension of earlier losses as the Indian unit may be weighed down by poor India gross domestic product growth data released on Friday. Secondly dollar demand from oil importers raised very sharply on decades low oil prices. Dollar index stability around 95 levels on uncertain surrounding putting Fed to take some pause for rising rate hikes. USDINR expected to move higher towards 67-67.20 levels. Buying on dips for small profits still to be done for the target of 67-67.20 levels.

• EURINR: The euro trading firm against INR above 75 levels on higher than expected retail sales data and inflation data. EURUSD trading $1.1207 levels. EURINR expected to trade firm till 75.50, upside limit becomes 75.80-76 levels.

Commodities

• Base Metals: Base metals bounced on LME as China introduced rate cuts in major lending rates in last week which enable to soar all risk assets including Chinese stocks more than 1-2% in the last week. Recovery in US equities on strong economic growth along with energy stocks on oil prices. Prices recovered yesterday from lowest levels in six years on LME from last week. Today metals came down on pressure of China fear of contraction reported on lower than estimated figure of manufacturing PMI posted today. In last week, Investors have been net-bearish on copper for 12 straight weeks, according to weekly data from the Commodity Futures Trading Commission released in last week. The most actively traded contract, for December delivery, was recently down 5.15 cents, or 2.2%, at $2.2945 a pound on the Comex division of the New York Mercantile Exchange. Today there will some correction on lower side after sharp selloff but overall buying still can be done on lower side as risk on rally is likely to be continued ahead of global PMI data due to release today,

Global Economic Events

Event

Country

Time (IST)

Estimates

Manufacturing PMIChina06.30 am50
Manufacturing PMIEuro Zone1.30 pm52.4
Manufacturing PMIUK7.15 pm52.9
Final Manufacturing PMIUS7.30 pm52.7

 Precious Metals: Gold's rally during a period of significant global market turbulence in August appears to have fizzled out, with investors refocusing on the chances of a U.S. interest-rate in coming months. The yellow metal had been one of the few bright spots among commodities, which have been hit hard by concerns about the health of the Chinese economy. Gold has slipped by 3.2% in the past week, as investors again recalibrate their U.S. rate expectations. Yesterday, the precious metal fell to $1,132.64 from $1177 levels in last week. Gold got hit majorly from Jackson hole met which gave sign of earlier rate hikes in coming months which added bets of dollar and lowered gold prices. There will some range trade likely to be in between $1130-1180 ahead of US NFP data. Gold expected to trade in the range of 26200- 26700 until the outcome of Jackson Hole comes.

 Energy: Oil prices surged higher Monday as the US government lowered its domestic production estimate and OPEC said it was "ready to talk" to producers about multi-year low prices. Oil jumps 8 percent, biggest three-day surge since 1990 Reuters Oil prices drop 3 percent as investors retreat from overnight gains Reuters Oil hits 6.5-year low as US crude supplies rise AFP US oil prices fall to fresh six-year low AFP US benchmark West Texas Intermediate for October delivery jumped 8.8% to $49.20 a barrel on the New York Mercantile Exchange, its third straight winning session. In London, Brent crude for October delivery closed at $54.15 a barrel, up 8.2% from Friday's close. Oil prices opened lower yesterday but pulled out of negative territory after the Department of Energy said that US domestic production in June was 9.3 million barrels a day, about 100,000 barrels lower than its previous estimate. Monthly estimates for the January to May period were revised lower by as much as 130,000 barrels a day. Today price are again trading down more than 3% in dollar terms but well supported on MCX due to rupee weakness. As prices remained well supporting from $38.50 levels which may expect to extend its gain towards $50 in near term. Gas expected to trade in range of Rs174-181 levels on moderate weather conditions in US.

LME Warehouse Updates (in ton)

MetalsTotal
Inventories
Cancelled
Warrants
(CW)
Change in
Stocks
Change in
CW
CW % of
Total
Inventory
Remarks
Aluminum-982532941250128160038.91CW ratio started improving from the lowest pace
Copper134753690252005310014.39Canceled warrants jump 36% to highest since July 14
Nickel52845438044416381236.05Stocks have fallen very sharply from highest levels in
record
Lead-100190675-3004522523.72Cancelled warrants 26% in the last week
Zinc1200526750757405014.06Stockpiles in Antwerp double to highest since Feb 14

Trend Watch

MCXResistanceSupportComments
Gold2675026200Failure to sustain below 26750 will see prices rebound towards 26700.
Silver3490033151Prices can rebound towards resistance between 34750—34900 levels.
Crude oil28852600Dips towards 2700 can be bought. The pullback can extend towards 2850/2880.
Copper342.50330A daily close above 342 will see prices rally towards 350. Until then sideways.
Nickel685630Buy on dips towards 650—645 can advance towards 670/680 levels.
Zinc117.10112Buy on dips towards 113.50 can advance towards resistance levels.
USDINR (Sep)67.2065.90Dips and reversal from around 66.40—66.30 can be bought.

Courtesy : Emkay Commotrade


Key Words:  base metals prices  base metal 

Metals and Currencies Daily Market Watch Sept 01, 2015 - Emkay Commotrade

Industry News 04:47:28PM Sep 01, 2015 Source:SMM

By  Paul Ploumis 01 Sep 2015  Last updated at 03:22:50 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 Yor

Macro Headlines

• China's official manufacturing PMI for August fell to 49.7, from 50.0 in July, lowest level in three years while Missing forecast Caixin PMI posted at 47.3 the lowest point in more than six years

• Fed policy makers speaking in Jackson Hole, over the weekend sticked to its plan to raise rates before the end of the year despite the recent pronounced swings in global markets

• Annual inflation in the euro zone steadied at 0.2% in August as in July, defying economists' expectations of a slowdown

• Oil spiked as EIA reported fall in output in June by 1.1% and OPEC said it was "ready to talk" to producers about multi-year low prices. 

Currencies

• USDINR: The rupee opened down against the US dollar with extension of earlier losses as the Indian unit may be weighed down by poor India gross domestic product growth data released on Friday. Secondly dollar demand from oil importers raised very sharply on decades low oil prices. Dollar index stability around 95 levels on uncertain surrounding putting Fed to take some pause for rising rate hikes. USDINR expected to move higher towards 67-67.20 levels. Buying on dips for small profits still to be done for the target of 67-67.20 levels.

• EURINR: The euro trading firm against INR above 75 levels on higher than expected retail sales data and inflation data. EURUSD trading $1.1207 levels. EURINR expected to trade firm till 75.50, upside limit becomes 75.80-76 levels.

Commodities

• Base Metals: Base metals bounced on LME as China introduced rate cuts in major lending rates in last week which enable to soar all risk assets including Chinese stocks more than 1-2% in the last week. Recovery in US equities on strong economic growth along with energy stocks on oil prices. Prices recovered yesterday from lowest levels in six years on LME from last week. Today metals came down on pressure of China fear of contraction reported on lower than estimated figure of manufacturing PMI posted today. In last week, Investors have been net-bearish on copper for 12 straight weeks, according to weekly data from the Commodity Futures Trading Commission released in last week. The most actively traded contract, for December delivery, was recently down 5.15 cents, or 2.2%, at $2.2945 a pound on the Comex division of the New York Mercantile Exchange. Today there will some correction on lower side after sharp selloff but overall buying still can be done on lower side as risk on rally is likely to be continued ahead of global PMI data due to release today,

Global Economic Events

Event

Country

Time (IST)

Estimates

Manufacturing PMIChina06.30 am50
Manufacturing PMIEuro Zone1.30 pm52.4
Manufacturing PMIUK7.15 pm52.9
Final Manufacturing PMIUS7.30 pm52.7

 Precious Metals: Gold's rally during a period of significant global market turbulence in August appears to have fizzled out, with investors refocusing on the chances of a U.S. interest-rate in coming months. The yellow metal had been one of the few bright spots among commodities, which have been hit hard by concerns about the health of the Chinese economy. Gold has slipped by 3.2% in the past week, as investors again recalibrate their U.S. rate expectations. Yesterday, the precious metal fell to $1,132.64 from $1177 levels in last week. Gold got hit majorly from Jackson hole met which gave sign of earlier rate hikes in coming months which added bets of dollar and lowered gold prices. There will some range trade likely to be in between $1130-1180 ahead of US NFP data. Gold expected to trade in the range of 26200- 26700 until the outcome of Jackson Hole comes.

 Energy: Oil prices surged higher Monday as the US government lowered its domestic production estimate and OPEC said it was "ready to talk" to producers about multi-year low prices. Oil jumps 8 percent, biggest three-day surge since 1990 Reuters Oil prices drop 3 percent as investors retreat from overnight gains Reuters Oil hits 6.5-year low as US crude supplies rise AFP US oil prices fall to fresh six-year low AFP US benchmark West Texas Intermediate for October delivery jumped 8.8% to $49.20 a barrel on the New York Mercantile Exchange, its third straight winning session. In London, Brent crude for October delivery closed at $54.15 a barrel, up 8.2% from Friday's close. Oil prices opened lower yesterday but pulled out of negative territory after the Department of Energy said that US domestic production in June was 9.3 million barrels a day, about 100,000 barrels lower than its previous estimate. Monthly estimates for the January to May period were revised lower by as much as 130,000 barrels a day. Today price are again trading down more than 3% in dollar terms but well supported on MCX due to rupee weakness. As prices remained well supporting from $38.50 levels which may expect to extend its gain towards $50 in near term. Gas expected to trade in range of Rs174-181 levels on moderate weather conditions in US.

LME Warehouse Updates (in ton)

MetalsTotal
Inventories
Cancelled
Warrants
(CW)
Change in
Stocks
Change in
CW
CW % of
Total
Inventory
Remarks
Aluminum-982532941250128160038.91CW ratio started improving from the lowest pace
Copper134753690252005310014.39Canceled warrants jump 36% to highest since July 14
Nickel52845438044416381236.05Stocks have fallen very sharply from highest levels in
record
Lead-100190675-3004522523.72Cancelled warrants 26% in the last week
Zinc1200526750757405014.06Stockpiles in Antwerp double to highest since Feb 14

Trend Watch

MCXResistanceSupportComments
Gold2675026200Failure to sustain below 26750 will see prices rebound towards 26700.
Silver3490033151Prices can rebound towards resistance between 34750—34900 levels.
Crude oil28852600Dips towards 2700 can be bought. The pullback can extend towards 2850/2880.
Copper342.50330A daily close above 342 will see prices rally towards 350. Until then sideways.
Nickel685630Buy on dips towards 650—645 can advance towards 670/680 levels.
Zinc117.10112Buy on dips towards 113.50 can advance towards resistance levels.
USDINR (Sep)67.2065.90Dips and reversal from around 66.40—66.30 can be bought.

Courtesy : Emkay Commotrade


Key Words:  base metals prices  base metal