Content Commodities Daily Report International Commodities

Commodities Daily Report
Tuesday, October 14, 2014
International Commodities
Content
Overview
Precious Metals
Energy
Base Metals
Important Events for today
Research Team
Prathamesh Mallya
Sr. Research Analyst
prathamesh.Mallya@angelbroking.com
(022) 2921 2000 Extn :6134
Anish Vyas
Research Analyst
anish.vyas@angelbroking.com
(022) 2921 2000 Extn :6104
Kaynat Chainwala
Research Associate
kaynat.chainwala@angelbroking.com
(022) 2921 2000 Extn :6136
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Disclaimer: The information and opinions contained in the document have been compiled from sources believed to be reliable. The company does not warrant its accuracy, completeness and
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Commodities Daily Report
Tuesday, October 14, 2014
International Commodities
Overview
India’s CPI fell to the lowest level since inception that is January’12.
SPDR Gold holdings rose 1.79 tonnes to 761.23 tonnes on Monday.
US banks were closed yesterday on the eve of Columbus Day.
Kuwait oil minister said OPEC unlikely to cut output to support prices.
German WPI rose around 0.1 percent in the previous month.
Asian markets are trading on a positive note today ahead of the
estimates of favorable economic data from the US in tomorrow’s trade.
The US Dollar Index (DX) traded on a negative note and declined around
0.4 percent yesterday on the back of estimates that US Federal Reserve
will keep interest rates lower for longer period of time. However, weak
market sentiments which led to rise in demand for the low yielding
currency cushioned sharp negative movement in the DX. The currency
touched an intra-day low of 85.21 and closed at 85.73 on Monday.
Market Highlights (% change)
as on October 13, 2014
Last
Prev day
w-o-w
m-o-m
y-o-y
INR/$
(Spot)
60.995
0.4
0.9
-0.7
0.0
$/Euro
(Spot)
1.2752
1.0
0.8
-1.4
-5.8
Dollar
Index
85.73
-0.4
-0.4
1.8
7.9
NIFTY
7884.3
0.3
#N/A
-3.3
33.5
The Indian Rupee traded on a positive note and appreciated around 0.4
percent in yesterday’s trading session. The currency appreciated on the
back of more than expected rise in Chinese exports data in September
which uplifted the overall Asian currencies.
SENSEX
26384.1
0.3
#N/A
-3.2
44.3
NEWS & DEVELOPMENTS
DJIA
16321.1
-1.3
-3.9
-4.7
6.7
S&P
1874.7
-1.6
-4.6
-5.6
10.1
th
Crude Oil Bullish Positions continued to fall for 15 week
Futures market traders and large speculators continued to lower their
overall bullish bets in crude oil futures last week as positions fell lower
for a fifteenth consecutive week, according to the latest Commitment of
Traders (COT) data released by the Commodity Futures Trading
Commission (CFTC) on Friday.
The non-commercial contracts of crude oil futures, traded by large
speculators, traders and hedge funds, declined to a total net position of
+293,683 contracts in the data reported for October 7th. This was a
change of -2,263 contracts from the previous week’s total of +295,946
net contracts for the data reported through September 30th.
For the week, standing non-commercial long positions in oil futures
gained by a total of 8,953 contracts while the short positions advanced
by 11,216 contracts to total the overall weekly net change of -2,263
contracts.
Nickel Asia says ore shipment value jumps 165% in Jan.-Sept.
Source: Reuters
In a statement attached to a disclosure, Nickel Asia said its four
operating mines sold 14.26 million wet metric tons (WMT) of
nickel ore in January to September, compared with 10.32
million WMT in the same comparable period.
The effect of the Indonesian ore export ban has led to a rapid
surge in ore prices to Chinese customers, significantly higher
than the increase experienced in LME (London Metal Exchange)
prices.
As a result, ore sales to Japanese customers, whose selling
price has been traditionally linked to LME prices, are now
benchmarked to China prices on the basis of a negotiated price
per WMT of ore starting April of this year.
Nickel Asia Corp. shipped P20.6 billion worth of nickel ore in the first nine
months of the year, up 165 percent from P7.8 billion year-on-year, the
company reported to the Philippine to the Philippine Stock Exchange on
Monday.
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Commodities Daily Report
Tuesday, October 14, 2014
International Commodities
Bullion
Gold
Spot gold prices traded positive yesterday and rose to a three-week high
as concern that the global economy is faltering fuelled bets that the
Federal Reserve will keep U.S. interest rates low, driving the dollar down
and boosting the safe haven appeal of the yellow metal. Also, Fed Vice
Chairman Stanley Fischer said on Oct. 11 that weak growth outside the
U.S. may prompt the central bank “to remove accommodation more
slowly than otherwise” supported gains. Holdings in SPDR Gold Trust, the
No.1 gold ETF and a good proxy for investor sentiment, rose 1.79 tonnes to
761.23 tonnes on Monday - the fund's first inflow since Sept. 10.
Further, gloomy economic signals out of Europe and a slowdown in China
have prompted many investors to push back their expectations for the
Fed’s first rate increase, damping the urgency to sell gold and eliciting
fresh bullish bets.
Market Highlights - Gold (% change)
Gold
Unit
Last
Gold (Spot)
$/oz
Gold (Spot
-Mumbai)
Rs/10
gms
26900.0
Comex
Gold
(Oct’14)
$/oz
MCX Gold
(Oct’14)**
Rs /10
gms
as on October 13, 2014
Prev.
day
1.13
MoM
YoY
2.5
-1.5
-2.8
0.00
0.4
-1.1
-9.7
1235.9
0.54
2.0
0.1
-2.5
26972.0
0.03
0.9
-1.1
-4.9
1236.8
Source: Reuters
Market Highlights - Silver (% change)
On the MCX, gold prices gained marginally as Rupee appreciation
restricted sharp gains and closed at Rs.26972/10gms.
Silver
Spot silver prices in the international markets gained in tandem with gains
in gold prices. Also, weakness in the DX coupled with positive trend in the
base metals complex acted as a positive factor for prices.
Spot silver prices in the international markets gained by 0.6 percent and
closed at $17.5/oz. On the MCX, silver prices fell by 0.5 percent owing to
Rupee appreciation and closed at Rs.38336/kg.
WoW
Silver
Unit
as on October 13, 2014
Last
Prev day
WoW
MoM
YoY
17.5
0.6
0.9
-8.3
-17.6
39250.0
2.7
0.1
-7.4
-28.2
Silver
(Spot)
$/oz
Silver
(Spot Mumbai)
Silver
(LBMA)
Rs/1 kg
$/oz
#N/A
#N/A
#N/A
#N/A
#N/A
Comex
Silver
(Sep’14)
MCX Silver
(Dec’14)**
$/ oz
17.3
-0.7
0.4
-7.5
-18.7
38336.0
-0.46
-0.4
-8.6
-18.2
Rs / kg
Source: Reuters
Outlook
Technical Chart – Spot Gold
On an intraday basis, we expect gold and silver prices to trade higher on
the back of falling appetite for risk as equities and the dollar tumbled on
global growth worries. Also, positive trend in SPDR holdings will support
gains.
On the MCX, gold and silver prices are expected to trade higher taking
cues from strength in international markets.
Technical Outlook
valid for October 14, 2014
Unit
Spot Gold
MCX Gold Oct’14
MCX Silver Dec’14
NCDEX Silver hedge Sep’14
Resistance
$/oz
1228/1224
1240/1247
Rs/10
gms
26850/26750
27100/27250
24090/24008
24320/24460
$/oz
17.30/17.10
17.60/17.80
Rs/kg
38000/37700
38700/39000
3400/3380
3460/3490
NCDEX Gold hedge Nov’14
Spot Silver
Support
Source: Reuters
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Commodities Daily Report
Tuesday, October 14, 2014
International Commodities
Energy
Crude Oil
Market Highlights - Crude Oil (% change)
WTI oil prices traded lower yesterday as indications Saudi Arabia is
comfortable with lower oil prices weighed.
Crude Oil
Oil prices sold off after Saudi Arabia privately told oil market
participants that it is ready to accept oil prices below $90 per barrel,
and perhaps down to $80, for an extended period. Saudi Arabia is the
largest exporter among OPEC members and produces approximately 10
million barrels of oil a day.
In addition, Kuwait's oil minister Ali al-Omair said OPEC is unlikely to cut
output to support prices. Al-Omair was quoted as saying that a drop to
the $76 to $77 a barrel range might be the level that would end the
recent slide in prices.
WTI oil prices in the international markets declined by 0.9 percent and
closed at $87.8/bbl.
On the MCX, crude prices plunged by 1.2 percent on Monday taking
cues from weak international markets and Rupee appreciation and
closed at Rs.5219/bbl.
Unit
Last
Brent
(Spot)
Nymex
Crude (Sep
’14)
ICE Brent
Crude
(Oct’14)
$/bbl
87.8
Prev.
day
-0.9
$/bbl
85.7
$/bbl
MCX Crude
(Oct ’14)
Rs/bbl
as on October 13, 2014
WoW
MoM
YoY
-3.1
-10.6
-21.7
-0.1
-5.1
-9.6
-16.0
88.9
-1.5
-4.2
-10.4
-20.1
5219.0
-1.2
-6.1
-8.0
-15.9
Source: Reuters
Market Highlights - Natural Gas (% change)
Natural
Gas (NG)
Nymex
NG
MCX NG
(Oct’14)
as on October 13, 2014
Unit
Last
Prev. day
WoW
MoM
YoY
$/mmbtu
3.99
1.81
0.40
-0.67
2.47
237.80
0.76
-1.37
-2.58
2.94
Rs/
mmbtu
Source: Reuters
Technical Chart – NYMEX Crude Oil
Outlook
On an intraday basis, we expect crude oil prices to trade lower as U.S.
corporations to oil-rich nations have refrained to help reduce supplies
and increase prices, thereby acting as a negative factor.
Also, investors’ expectations that members of the Organization of the
Petroleum Exporting Countries would collectively cut production have
been put to ease and will exert downside pressure on prices.
Source: Reuters
On the MCX, crude prices are expected to trade lower taking cues from
weak international markets.
Technical Outlook
Technical Chart – NYMEX Natural Gas
valid for October 14, 2014
Unit
Support
Resistance
NYMEX Crude Oil
$/bbl
84.40/83.80
82.70/86.60
MCX Crude Oct’14
Rs/bbl
5180/5140
5260/5310
NCDEX Crude Oct’14
Rs/bbl
5210/5175
5295/5345
Source: Reuters
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Commodities Daily Report
Tuesday, October 14, 2014
International Commodities
Base Metals
Base metals on the LME traded higher yesterday as 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.
Prices also advanced after Premier Li Keqiang said China still expects
the economy to expand by about 7.5 percent in 2014.
In the Indian markets, base metals traded on a mixed note and Rupee
appreciation capped sharp gains.
Market Highlights - Base Metals (% change)
Unit
LME Copper (3
Last
as on October 13, 2014
Prev. day
WoW
MoM
YoY
$/tonne
6737.0
0.5
0.4
-1.7
-6.4
Rs/kg
413.3
-0.3
-0.7
-2.2
-7.3
$/tonne
1945.8
0.5
0.9
-6.1
3.2
Rs /kg
118.7
0.0
-0.1
-5.9
3.4
$/tonne
16510.0
0.5
-1.5
-12.5
18.7
Rs /kg
1005.0
-0.2
-2.7
-12.6
18.1
$/tonne
2069.8
0.2
-1.6
-3.1
-1.7
Rs /kg
126.1
-0.4
-2.7
-2.9
-1.4
$/tonne
2334.3
0.2
0.9
1.0
21.8
Rs /kg
142.1
-0.3
0.0
1.2
22.9
month)
MCX Copper
(Nov’14)
LME Aluminum
(3 month)
MCX Aluminum
(Sep’14)
LME Nickel
Copper
(3 month)
LME Copper prices gained 0.5 percent yesterday as China’s imports of
copper ore and concentrate climbed for a second month to a record
as the world’s biggest producer of the refined metal boosts capacity.
The record shipments come as smelters in the world’s largest metals
consumer ramp up production capacity. According to data from the
National Bureau of Statistics, China produced 681,000 tons of refined
copper in August, climbing 7.4 percent from the previous month and
21 percent from the same month last year.
MCX Nickel
(Sep’14)
LME Lead
(3 month)
MCX Lead
(Sep’14)
LME Zinc
(3 month)
However, gain of more than 1 percent in LME stocks coupled with
concerns of demand in Euro Zone capped sharp gains. The red metal
touched closed at $6737/tonne in the last session.
MCX Zinc
(Sep’14)
Source: Reuters
LME Inventories
In the Indian markets, copper prices fell by 0.2 percent due to Rupee
appreciation and closed at Rs.413.3/kg on Monday.
Outlook
From the intra-day perspective, we expect copper prices to trade
lower today owing to expectations of weak economic data from Euro
Zone. Also, Freeport-McMoRan Inc's Indonesian unit can resume
open-pit mining at its Grasberg complex, one of the world's biggest
copper mines will act as a negative factor.
Unit
13th October
10th October
Actual
Change
(%)
Change
Copper
tonnes
151225
149650
1575
1.05%
Aluminum
tonnes
4545700
4554325
-8625
-0.19%
Nickel
tonnes
368364
367134
1230
0.34%
Zinc
tonnes
729025
731675
-2650
-0.36%
Lead
tonnes
225650
224950
700
0.31%
Source: Reuters
Technical Chart – LME Copper
On the MCX, Copper prices will trade lower in line with trend in
international markets.
Technical Outlook
valid for October 16, 2014
Unit
Support
Resistance
MCX Copper Nov’14
Rs /kg
411/408
416/420
MCX Zinc Oct’14
Rs /kg
141/140
143/144
MCX Lead Oct’14
Rs /kg
125/124
127/128
MCX Aluminum Oct’14
Rs /kg
116.50/115.50
118.50/119.50
MCX Nickel Oct’14
Rs /kg
998/990
1012/1020
Source: Reuters
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Commodities Daily Report
Tuesday, October 14, 2014
International Commodities
Important Events for Today
Indicator
New Loans
Country
Time (IST)
th
th
Actual
Forecast
Previous
Impact
China
14 -15
-
750B
703B
Medium
CPI y/y
UK
2:00pm
-
1.4%
1.5%
High
PPI Input m/m
UK
2:00pm
-
-0.4%
-0.6%
Medium
RPI y/y
UK
2:00pm
-
2.3%
2.4%
Medium
German ZEW Economic Sentiment
Euro
2:30pm
-
0.2
6.9
High
Industrial Production m/m
Euro
2:30pm
-
-1.5%
1.0%
Medium
ZEW Economic Sentiment
Euro
2:30pm
-
7.1
14.2
Medium
ECOFIN Meetings
Euro
All Day
-
-
-
Medium
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