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Friday, 02 December 2016

International Commodity Daily Reports

Content

Overview

Precious Metals

Energy

Base Metals

Important Events for today




Market Overview

Asian markets are trading on a mixed note as investors’ book-profits

from yesterday’s rally after the OPEC members agreed to cut

production from January’17 by around 1.2 million barrels per day bpd

for the first time since 2008 in a bid to support prices.

After trading higher in the last few days, the US Dollar Index

weakened by 0.46 percent in yesterday’s trading session. The fall in

the currency was mainly due to the disappointing release of

manufacturing and unemployment claims data from the nation.

Americans who filed for unemployment benefits have raised

considerable since June, indicating a possible pause in progress in the

labor market. Markets are pretty cautious as this data comes ahead

of Friday's monthly jobs report, seen by many investors as the

clearest read on the health of the job market.

However, markets are still rejoicing the decision of the OPEC

members of cutting oil output in a bid to support prices. The

agreement came despite huge political hurdles. Moreover, in a

recent comment the US Fed policymaker Loretta J. Mester spoke in

favor of raising interest rates. She said that postponing them for too

long would raise risks of recession and financial instability.

The Indian Rupee appreciated by 0.53 percent yesterday following

gains in Asian market currencies as the markets discounted the

decision of the Organization of the Petroleum Exporting Countries of

agreeing to cut oil output. This boosted the market confidence which

led to buying of INR.

Moreover, outflow of $25 billion of FCNR deposits were eased by

suspected intervention by RBI through state-owned banks which

further acted as a positive factor. There is a rising speculation that

the Reserve Bank of India will lower its repo rate by 25 basis points to

6 percent in its next month monetary policy meeting; all thanks to

lower inflation rate.

News & developments

OPEC’s Oil Rally Seen Setting Stage for 2017 Price Retreat

After jumping the most in nine months, oil is expected to climb

further after OPEC beat the odds to agree on an output cut. Just

don’t expect the rally to last.

Russia is ready to freeze its oil output - among the world’s highest - at

The Organization of Petroleum Exporting Countries sent crude oil

prices soaring Wednesday after agreeing to its first production cuts in

eight years, a deal designed to drain record global oil inventories.

The pact overcame discord between the group’s three largest

producers -- Saudi Arabia, Iran and Iraq -- and ended its pump-at-will

policy started in 2014 aimed at protecting market share and driving

out high-cost drillers. (Bloomberg)

Market Highlights (% change) as on Dec 1, 2016

INDICES LAST CHANGE WOW MOM YOY

INR/$ (Spot) 68.2 0.53 0.8 -2.3 -2.6

Euro/$ (Spot) 1.1 0.71 1.0 -3.6 -2.5

Dollar Index 101.1 -0.4 -0.6 4.0 27.2

NIFTY 8192.9 -0.38 2.0 -5.0 3.2

SENSEX 26559.9 -0.35 2.0 -4.7 45.2

DJIA 19191.9 0.36 0.6 7.0 9.8

S&P 2213.4 0.4 7.2 7.5 5.1

Source: Reuters

o US factory activity accelerates to five month high

U.S. factory activity accelerated to a five-month high in November

amid a pickup in new orders and production, suggesting that the

manufacturing sector was regaining its footing after a prolonged

slump.

Thursday's report from the Institute for Supply Management

(ISM), which also showed some bottlenecks in the supply chain

that could drive prices higher, was the latest indication that the

economy continued to gain momentum in the fourth quarter.

The ISM said its index of national factory activity rose 1.3

percentage points to a reading of 53.2 last month, the best since

June. A reading above 50 indicates an expansion in manufacturing,

which accounts for about 12 percent of the U.S. economy.

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Market Highlights - Gold (% change) as on Dec 1, 2016

COMMODITY LAST CHANGE WOW MOM YOY

GOLD(SPOT) 1170.9 -0.15 -1.4 -9.1 10.4

GOLD (SPOT -

MUMBAI)

28375.0 -1.48 -3.6 #N/A 13.0

COMEX 1172.7 0.50 -0.5 -10.0 11.2

MCX(DEC’16) 27957.0 -0.85 -2.9 -7.5 11.5

(Comex, Gold spot in $ per ounce, MCX, Gold spot Mumbai in Rs/10 gms) Source: Reuters

Market Highlights - Silver (% change) as on Dec 1, 2016


SILVER(SPOT) 16.5 0.2 0.9 -9.9 19.1

SILVER (SPOT -

MUMBAI)

40600.0 -1.9 -2.6 #N/A #N/A

COMEX 16.4 0.1 -0.2 -10.4 16.9

MCX (DEC’16) 40643.0 -0.79 -1.1 -8.1 20.2

(Comex in $ per ounce, MCX, Silver spot in Rs/kg) Source: Reuters

MCX Gold Chart

Source: Reuters

MCX Silver Chart

Source: Reuters

Daily /MAUG7 03-10-2016 - 05-12-2016 (BOM)

Cndl, /MAUG7,

01-12-2016, 28,150.00, 28,213.00, 27,891.00, 27,957.00, N/A, N/A

Price

INR

TOLAS

28,000

28,500

29,000

29,500

30,000

30,500

27,957.00

03 10 17 24 31 07 14 21 28 05October 2016 November 2016

Daily /MSVH7 04-10-2016 - 05-12-2016 (BOM)

Cndl, 40,643.00N/A, N/A INR

Kg

42,00040,643.00

10 17 24 31 07 14 21 28 05October 2016 November 2016

Bullion

Gold On Thursday, spot gold prices declined marginally by 0.15 percent to

close at $1170.9 per ounce extending losses after its biggest monthly

decline in more than three years, as a surge in oil prices boosted bond

yields, denting interest in non-yielding gold as an alternative

investment.

The precious metal fell more than 8 percent in November, hurt by a

jump in the dollar and Treasury yields after Donald Trump's surprise

election to the U.S. presidency led to speculation that his

commitment to infrastructure spending would spur growth and

inflation.

On the MCX, gold prices declined by 0.85 percent to close at Rs.27957

per kg.

Silver Spot silver prices rose by 0.2 percent on Thursday to close at $16.5

per ounce in contrary to decline in gold prices although weak dollar

index supported the rise in silver prices.

On the MCX, silver prices declined by 0.8 percent to close at Rs.40643

per kg.

Outlook On an intraday basis, we expect gold prices to trade lower as low

investment demand, probability of rate hike in the US and surge in oil

prices are factors exerting downside pressure.

On the MCX, gold prices are expected to trade lower today,

international markets are trading higher by 0.33 percent to close at

$1174.72 per ounce.

Technical Outlook valid for December 2, 2016

COMMODITY SUPPORT RESISTANCE SPOT GOLD ($/OZ) 1168/1160 1179/1186

MCX GOLD FEB’17 (Rs/10GMS) 27780/27600 28050/28200

NCDEX GOLD HEDGE DEC’16

(Rs/KG) 26160/25990 26420/26560

SPOT SILVER ($/OZ) 16.40/16.20 16.70/16.85

MCX SILVER MAR’17 (Rs/KG) 40200/39700 40900/41300




Market Highlights - Crude Oil (% change) as on Dec 1, 2016


BRENT (SPOT) 51.8 9.5 13.3 14.6 41.4

NYMEX CRUDE (JAN’17) 51.1 3.3 6.5 9.4 27.8

ICE BRENT CRUDE (NOV’16)

53.9 6.9 10.2 12.0 47.9

MCX CRUDE (DEC’16) 3527.0 4.4 6.3 13.6 44.4

(Brent & NYMEX Crude in $ per ounce, MCX Crude in Rs/bbl) Source: Reuters

Market Highlights - Natural Gas (% change) as on Dec 1, 2016


NYMEX NG 3.49 4.62 11.32 15.87 51.81

MCX NG (DEC’16) 239.80 4.44 14.14 21.97 62.47

(NYMEX NG in $/MMbtu, MCX NG in Rs/MMBtu Source: Reuters

MCX Crude Oil Chart

Source: Reuters

Daily /MCGBZ6 07-10-2016 - 05-12-2016 (BOM)

Cndl, 3,527.00, N/A, N/A INR

Bbl

3,000

3,300

3,527.00

10 17 24 31 07 14 21 28 05October 2016 November 2016

Energy

Crude Oil

WTI oil prices rose by 3.3 percent on Thursday to close at $51.1 per

ounce with Brent crude at its highest in about 16 months, extending

gains after OPEC and Russia agreed to restrict output to reduce the

global supply glut more quickly.

The Organization of the Petroleum Exporting Countries agreed on

Wednesday to its first oil output reduction since 2008 after the group's

leading producer Saudi Arabia accepted "a big hit" and dropped a

demand that arch-rival Iran also slash output.

The deal also included OPEC's first coordinated action in 15 years with

non-member Russia. Azerbaijan said it was also willing to discuss cuts.

On the MCX, oil prices rose by 4.4 percent to close at Rs.3527 per

barrel.

Outlook We expect oil prices to trade positive continuing its momentum from

previous trading session as the deal by the OPEC to cut oil output is a

step in right direction in order to bring in stability in oil markets.

On the MCX, oil prices are expected to trade higher today,

international markets are trading lower by 0.33 percent at $50.89 per

barrel.


COMMODITY SUPPORT RESISTANCE

NYMEX CRUDE OIL ($/BBL) 49.90/49.10 51.85/52.70

MCX CRUDE DEC’16 (RS/BBL) 3460/3400 3590/3650

BRENT CRUDE DEC’16 (RS.BBL) 3650/3580 3770/3830




Base Metals LME base metals traded mixed yesterday as the OPEC finally reached

a deal to cut output in order to provide a necessary cushion to oil

prices, reducing the risk aversion. However, global investors are

cautiously awaiting US jobs data and Italy constitutional referendum

later this week.

MCX base metals traded mixed yesterday in line with international

trends.

Copper LME Copper prices traded lower by 0.6 percent yesterday as latest

steps by Chinese commodity exchanges to restrict wild price rallies in

the metals space acted as a negative factor.

However, sharp downside was restricted as the Organization of the

Petroleum Exporting Countries reached a deal on Wednesday to

reduce their oil production by 1.2 million barrels per day in order to

raise global prices.

Moreover, manufacturing data from the US and China expanded in

November, adding to positive demand outlook.

MCX copper prices traded higher by 1 percent to close at Rs.399.6

per kg on Thursday.

Outlook LME Copper is currently trading lower by 0.8 percent at $5745/t.

Copper prices will trade lower today as investors will be eyeing US

Non-Farm Employment Change and Italy referendum although

increased manufacturing activity in the major consumers might

provide a cushion

We expect MCX Copper prices to trade lower today on the MCX.


COMMODITY (RS/KG) SUPPORT RESISTANCE

MCX COPPER FEB’16 396/392 402/406

MCX ZINC DEC’16 187/185.50 190/191.50

MCX LEAD DEC’16 158.50/157 161/162.50

MCX ALUMINUM DEC’16 116/114.50 118.50/120

MCX NICKEL DEC’16 755/745 775/785

Market Highlights – Base Metals (% change) as on Dec 1, 2016

COMMODITY LAT CHANGE WOW MOM YOY

LME Copper (3 month) 5791.0 -0.6 0.9 -3.2 22.3

MCX Copper (FEB’16) 399.6 1.0 0.9 6.4 25.5

LME Aluminum(3 month) 1720.0 -0.6 -3.3 -3.4 12.1

MCX Aluminum (DEC’16) 117.4 0.0 -3.8 5.6 16.1

LME Nickel(3 month) 11200.0 0.3 -3.7 -13.8 29.1

MCX Nickel (DEC’16) 764.7 1.4 -4.2 -5.4 33.1

LME Lead(3 month) 2350.0 0.2 5.0 25.1 31.3

MCX Lead (DEC16) 160.8 0.6 5.0 36.7 35.0

LME Zinc(3 month) 2761.0 2.2 2.0 29.6 69.4

MCX Zinc (DEC’16) 188.4 2.4 2.4 42.2 75.6

Source: Reuters

LME Inventories in tonnes

COMMODITY 1/12/16 30/11/2016 CHG %CHG

Copper 236675 234825 1850 0.79%

ALUMINIUM 2144850 2149150 -4300 -0.20%

NICKEL 367008 366834 174 0.05%

ZINC 442000 442400 -400 -0.09%

LEAD 187725 187725 0 0.00%

Source: Reuters

MCX Copper Chart

Source: Reuters

Daily /MCCc1 03-10-2016 - 05-12-2016 (BOM)

Cndl, 399.60N/A, N/A INR

Kg

300

350

399.60

03 10 17 24 31 07 14 21 28 05October 2016 November 2016




Economic indicators to be released on 2-Dec-16

INDICATOR COUNTRY TIME (IST) ACTUAL FORECAST PREVIOUS IMPACT

Spanish Unemployment Change Euro 1:30pm - -25.8K 44.7K Medium

Construction PMI UK 3:00pm - 52.3 52.6 High

Average Hourly Earnings m/m US 7:00pm - 0.2% 0.4% High

Non-Farm Employment Change US 7:00pm - 165K 161K High

Unemployment Rate US 7:00pm - 4.9% 4.9% High

FOMC Member Brainard Speaks US 7:15pm - - - Medium

Research Team

Prathamesh Mallya Chief Manager (Non-Agro Commodities & Currency) [email protected] (022) 3935 8134 Extn :6134

Kaynat Chainwala Research Analyst [email protected] (022) 3935 8136 Extn: 6136

Angel Commodities Broking Pvt. Ltd.

Registered Office: G-1, Ackruti Trade Centre, Rd. No. 7, MIDC, Andheri (E), Mumbai - 400 093.

Corporate Office: 6th Floor, Ackruti Star, MIDC, Andheri (E), Mumbai - 400 093. Tel: (022) 2921 2000

MCX Member ID: 12685 / FMC Regn No: MCX / TCM / CORP / 0037 NCDEX: Member ID 00220 / FMC Regn No: NCDEX / TCM / CORP / 0302

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 correctness. The document is not, and should not be construed as an offer to sell or solicitation to buy any commodities. This document may not be reproduced,

distributed or published, in whole or in part, by any recipient hereof for any purpose without prior permission from “Angel Commodities Broking (P) Ltd”. Your feedback is

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