Sushil Finance's Daily Commodity Update

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3 rd June,2014 For Private Circulation Only MAJOR INDICES Index Close Previous Close Change % Change DJIA 16743.63 16717.17 26.46 0.16 NASDAQ 4237.2 4242.62 -5.42 -0.13 HANGSN 9950.12 9943.27 6.85 0.07 NIKKIE 6864.1 6844.51 19.59 0.29 DAX 23081.65 23081.65 0 0.00 FTSE 14935.92 14632.38 303.54 2.07 SENSEX 24684.85 24217.34 467.51 1.93 NIFTY 7331.2 7230 101.2 1.40 News & Development German Prelim CPI declined 0.1 percent in May from -0.2 percent in April. Europe Final Manufacturing PMI fell to 52.2 levels in May from 52.5 marks in April. United Kingdom (UK) Manufacturing PMI fell to 57.0 levels in May from 57.3 marks in April. US ISM Manufacturing PMI rose to 55.4 levels in May from 54.9 Marks in April. China’s Non-Manufacturing PMI rose to 55.5 levels in May from 54.8 Marks in April. China’s HSBC Final Manufacturing PMI fell to 49.4 levels in May from 49.7 Marks in April. A potential shortfall in investment in production in the Middle East could create a $15 spike in the oil price by 2035, the energy arm of the Organization for Economic Co-operation and Development (OECD) said. (Source : Reuters) The world will need to be a total of $40 trillion invested in energy supply and $8 trillion on energy efficiency by 2035 to meet growing demand and falling output from mature sources of energy, the International Energy Agency (IEA) said in a report. (Source : Reuters) Russia and Ukraine agreed on Monday to consider a proposal for Kiev to pay off a multi-billion-dollar gas bill that has soured relations between Moscow and Kiev, while fighting raged all day in eastern Ukraine. (Source : Reuters) Investors pulled $4 billion from U.S. commodity exchange-traded products in the first five months of the year, extending last year's negative trend even as the pace of the redemptions from gold slowed, Thomson Reuters' Lipper data showed on Monday. (Source : Reuters) China's northeastern port of Qingdao has halted shipments of aluminium and copper due to an investigation by authorities, causing concern among bankers and trade houses financing the metals, trading and warehousing sources said on Monday. (Source : Reuters) Gross natural gas production in the Lower 48 U.S. states in March jumped 1.6 percent from February to a record 76.68 billion cubic feet per day, data from the U.S. Energy Information Administration showed on Friday. (Source : Reuters)

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Sushil Finance present their daily update on the commodity markets. Read about the latest commodity news, outlook and technical strategies on Gold, Silver, Crude Oil.

Transcript of Sushil Finance's Daily Commodity Update

Page 1: Sushil Finance's Daily Commodity Update

3rd June,2014 For Private Circulation Only

MAJOR INDICES

Index Close Previous Close Change % Change

DJIA 16743.63 16717.17 26.46 0.16

NASDAQ 4237.2 4242.62 -5.42 -0.13

HANGSN 9950.12 9943.27 6.85 0.07

NIKKIE 6864.1 6844.51 19.59 0.29

DAX 23081.65 23081.65 0 0.00

FTSE 14935.92 14632.38 303.54 2.07

SENSEX 24684.85 24217.34 467.51 1.93

NIFTY 7331.2 7230 101.2 1.40

News & Development

German Prelim CPI declined 0.1 percent in May from -0.2 percent in April.

Europe Final Manufacturing PMI fell to 52.2 levels in May from 52.5 marks in April.

United Kingdom (UK) Manufacturing PMI fell to 57.0 levels in May from 57.3 marks in April.

US ISM Manufacturing PMI rose to 55.4 levels in May from 54.9 Marks in April.

China’s Non-Manufacturing PMI rose to 55.5 levels in May from 54.8 Marks in April.

China’s HSBC Final Manufacturing PMI fell to 49.4 levels in May from 49.7 Marks in April.

A potential shortfall in investment in production in the Middle East could create a $15 spike in the oil price by 2035, the energy arm

of the Organization for Economic Co-operation and Development (OECD) said. (Source : Reuters)

The world will need to be a total of $40 trillion invested in energy supply and $8 trillion on energy efficiency by 2035 to meet

growing demand and falling output from mature sources of energy, the International Energy Agency (IEA) said in a report. (Source :

Reuters)

Russia and Ukraine agreed on Monday to consider a proposal for Kiev to pay off a multi-billion-dollar gas bill that has soured

relations between Moscow and Kiev, while fighting raged all day in eastern Ukraine. (Source : Reuters)

Investors pulled $4 billion from U.S. commodity exchange-traded products in the first five months of the year, extending last year's

negative trend even as the pace of the redemptions from gold slowed, Thomson Reuters' Lipper data showed on Monday. (Source :

Reuters)

China's northeastern port of Qingdao has halted shipments of aluminium and copper due to an investigation by authorities, causing

concern among bankers and trade houses financing the metals, trading and warehousing sources said on Monday. (Source : Reuters)

Gross natural gas production in the Lower 48 U.S. states in March jumped 1.6 percent from February to a record 76.68 billion cubic

feet per day, data from the U.S. Energy Information Administration showed on Friday. (Source : Reuters)

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Commodity Daily

Gold

A spot gold price decreased by 0.53 percent in Yesterday’s trading session on the back of strength in Dollar Index. Further, market participants expect US Federal Reserve to continue reducing its stimulus package at same pace added downside pressure on the prices. Additionally, strong economic data from US and upbeat equity markets led to decline in demand for safe haven. However, geopolitical tensions cushioned sharp decline in prices..

In the Indian Markets, gold prices fell by 0.51 percent in yesterday’s trading session taking cues from the Intl Spot gold prices. However, depreciation in the Indian Rupee prevented sharp fall in the prices. Gold prices touched an intraday low of 25690/10gms and closed at

25749/10gms.

Outlook

We expect spot gold prices to trade on the negative note on the back of strength in Dollar Index. Further, market participants expect US Federal Reserve to continue reducing its stimulus package at same pace may add downside pressure on the prices. Additionally, optimistic global market sentiments and strong economic data from US may act as a negative factor for the prices, as the demand for safe haven may go down. However, geopolitical tensions may cushion sharp fall in the prices. In the Indian Market, depreciation in the Indian Rupee may prevent sharp downside in the prices.

PERFORMANCE Open High Low Close % Change

MCX Gold 25834 25889 25690 25749 -0.51

International Spot Gold

1250.54 1250.54 1240.69 1244 -0.53

Source: Reuters & Sushil Research

Technical Outlook

Strategy Support Resistance

MCX Gold Aug Sell on Rallies 25450/25600 25900/26020

Silver A spot Silver price increased by 0.16 percent in yesterday’s trading session on the back of upbeat global market sentiments coupled with strong economic data from US. Further, upside in Base Metal prices supported Silver to trade in green. However, expectations among the market participants that the US Federal Reserve may continue reducing its stimulus package at same pace and weakness in Spot gold prices capped sharp upside in the prices. In the Indian Markets, silver prices rose by 0.10 percent taking cues from Intl spot Silver prices. Further, depreciation in the Indian Rupee supported prices. Silver prices touched an intraday high of 39859/Kg and closed at 39626/Kg

Outlook We expect spot Silver prices to trade on the mixed note. Strength in Dollar Index and expectations among the market participants that the US Federal Reserve may continue reducing its stimulus package at same pace may add downside pressure on the prices. Additionally, weakness in Spot Gold prices may act as a negative factor for the prices. Whereas, strong economic data from US, rise in risk appetite in the global markets and upside in base metal pack may support Silver to trade in green. In the Indian Market, depreciation in the Indian Rupee may prevent sharp downside in the prices.

PERFORMANCE

Open High Low Close % Change

MCX Silver

39657 39859 39465 39626 0.10

International Spot Silver 18.79 18.87 18.62 18.71 0.16

Source: Reuters & Sushil Research

Technical Outlook

Strategy Support Resistance

MCX Silver July

Sell on Rallies 39000/39450 39900/40250

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Commodity Daily

Crude Oil NYMEX Crude oil prices decreased by 0.23 percent in yesterday’s trading session on the back of strength in Dollar Index coupled with the rise in OPEC oil production. Further, expectations among the market participants that the US Federal Reserve may continue reducing its stimulus package at same pace added downside pressure on the prices. However, ongoing geopolitical tensions, strong economic data from US and rise in risk appetite in the global markets cushioned sharp fall in the prices. In the Indian Markets, a price declined by 0.69 percent taking cues from NYMEX Crude oil prices. However, sharp fall was prevented due to depreciation in the Indian Rupee. Crude oil prices touched an intraday low of 6059/bbl and closed at 6064/bbl.

Outlook

We expect NYMEX crude oil prices to trade on the negative note on the back of strength in DX coupled with rise in OPEC oil production. Further, expectations among the market participants that the US Federal Reserve may continue reducing its stimulus package at same pace may add downside pressure on the prices. However, rise in risk appetite in the global markets along with the strong economic data from US and China may cushion sharp fall in the prices. In the Indian Market, depreciation in the Indian Rupee may prevent sharp downside in the prices.

PERFORMANCE

Open High Low Close Change

MCX Crude Oil 6115 6133 6059 6064 -0.69

International Crude Oil

102.92 103.35 102.1 102.47 -0.23

Source: Reuters & Sushil Research

Technical Outlook

Strategy Support Resistance

MCX Crude Oil June

Sell below 6070

6020/6055 6100/6135

Natural Gas

A NYMEX Natural Gas price increased by 1.54 percent in Yesterday’s trading session on the forecast of hot weather in short term and cooler weather in long term. However, strength in DX capped sharp rise in the prices. In the Indian Markets, a Natural gas price rose by 0.77 percent in yesterday’s trading session taking cues from NYMEX prices along with the depreciation in the Indian rupee. Natural Gas prices touched an intraday high of 273.7/mmbtu and closed at 273.3/ mmbtu.

Outlook We expect NYMEX Natural gas prices to trade on the positive note on the back of colder weather forecast for longer term. However, strength in DX may prevent sharp rise in the prices. In the Indian Markets depreciation in the Indian may support prices to trade in green.

PERFORMANCE

Open High Low Close Change

MCX Natural Gas

271.9 273.7 268.6 273.3 0.77

International Natural Gas

4.551 4.62 4.522 4.612 1.54

Source: Reuters & Sushil Research

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Technical Outlook

Strategy Support Resistance

MCX Natural Gas June

Sideways 267/270 275/279

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Commodity Daily

3rd June, 2014 For Private Circulation Only

PERFORMANCE

Open High Low Close Change

COPPER MCX 411.7 416.85 411.7 415.95 1.25

COPPER LME 6860.5 6935.5 6859.25 6926.75 1.22

LEAD MCX 123.9 125.65 123.65 125.55 1.45

LEAD LME 2099 2126.75 2092.75 2122.5 1.46

ZINC MCX 121.75 124.05 121.7 123.9 1.47

ZINC LME 2053.75 2086 2049 2085.75 1.60

NICKEL MCX 1148.4 1159.6 1144.6 1152.5 0.69

NICKEL LME 19299 19575 19203 19440 0.73

ALUMINIUM MCX 108.25 109.3 108.15 109 0.88

ALUMINIUM LME 1832 1860 1832 1850 1.13

Base Metals Base Metals on LME traded on positive note on the back of rise in risk appetite in the global markets. Further, strong manufacturing data from China and US fuelled the expectations that the demand for base metal may go up. However, sharp upside in the prices was capped due to strength in DX.

LME Copper increased by 1.22 percent on the back of positive economic data from US and China along with the decline in LME inventories. Further, upbeat global market sentiments supported prices to trade in green. However, strength in DX along with the expectations among the market participants that the US Federal Reserve may continue reducing its stimulus package at same pace capped sharp rise in the prices.

In the Indian Markets copper prices rose by 1.25 percent in yesterday’s trading session taking cues from LME prices along with depreciation in the Indian Rupee. MCX Copper touched an intraday High of 416.85/kg and closed at 415.95/kg

Outlook We expect base metal prices to trade on the positive note on the back of risk appetite in the global markets along with the decline in LME inventories. Further, strong manufacturing data from China and US fuelled the expectations that the demand for base metal may go up. However, strength in DX along with the expectations among the market participants that the US Federal Reserve may continue reducing its stimulus package at same pace may cap sharp rise in the prices. In the Indian Market, depreciation in the Indian Rupee may support prices to trade in green.

Source: Reuters & Sushil Research

Technical Outlook

Strategy Support Resistance

MCX Copper June

Buy on Dips 409/412 415/418

MCX Lead June Buy on Dips

123.6/124.5 126/126.4

MCX Zinc June Buy on Dips

122.3/123 124.4/124.8

MCX Nickel June Buy on Dips

1125/1140 1160/1175

MCX Aluminium June

Buy on Dips 107.7/108.1 109.3/110

Source: Reuters & Sushil Research.

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Commodity Daily

Global Data

Data Country Date Time Actual Expected Previous Impact

Non-Manufacturing PMI China 03/06/2014 6:30am 55.5 - 54.8 High

HSBC Final Manufacturing PMI

China 03/06/2014 7:15pm 49.4 49.7 49.7 High

Nationwide HPI m/m UK 03/06/2014 11:30am - 0.7% 1.2% Medium

Spanish Unemployment Change

Europe 03/06/2014 12:30pm - - -11.6K Medium

Construction PMI UK 03/06/2014 2:00pm - 61.2 60.8 High

CPI Flash Estimate y/y Europe 03/06/2014 2:30pm - 0.7% 0.7% High

Unemployment Rate Europe 03/06/2014 2:30pm - 11.8% 11.8% Medium

Factory Orders m/m US 03/06/2014 7:30pm - 0.6% 1.1% Medium

For Further Assistance Contact: - 022-40934000 Ashish Shah Tejas Nikhar Saif Mukadam

AVP [email protected]

Sr. Research Analyst [email protected]

Research Analyst [email protected]

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