Commodities Daily Report

Tuesday| May 14, 2013

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Research Team
Vedika Narvekar - Sr. Research Analyst vedika.narvekar@angelbroking.com (022) 2921 2000 Extn :6130 Saif Mukadam Research Analyst saif.mukadam@angelbroking.com (022) 2921 2000 Extn :6136 Anish Vyas - Research Analyst anish.vyas@angelbroking.com (022) 2921 2000 Extn :6104

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Commodities Daily Report

Tuesday| May 14, 2013

International Commodities
Overview
US Core Retail Sales declined by 0.1 percent in the month of April. Chinas Industrial Production grew by 9.3 percent in the last month. US Retail Sales gained by 0.1 percent in the prior month. Asian markets are trading higher today on the back of favorable economic data from US which has led to rise in risk appetite in the global market sentiments. US Core Retail Sales declined by 0.1 percent in April as against a fall of 0.4 percent in March. Retail Sales gained by 0.1 percent in last month from earlier decline of 0.5 percent in March. Chinas Fixed Asset Investment rose at slow pace of 20.6 percent in April as against a rise of 20.9 percent in March. Industrial Production grew by 9.3 percent in April from earlier rise of 8.9 percent a month ago. Retail Sales increased by 12.8 percent in last month as compared to rise of 12.6 percent in March. The US Dollar Index (DX) increased by 0.2 percent in the yesterdays trading session on the back of rise in risk aversion in the global market sentiments which led to increase in demand for the low yielding currency. Further, US equities traded on a mixed note which also supported an upside in the DX. However, sharp upside in the currency was capped on account of favorable retail sales data from the US. The currency touched an intraday high of 83.455 and closed at 83.37 on Monday. The Indian Rupee depreciated marginally by 0.01 percent in yesterdays trading session. The currency depreciated on account of increase in dollar demand from oil and gold importers. Additionally, mixed global market sentiments coupled with strength in the DX exerted downside pressure on the currency. However, sharp downside in the Indian Rupee was cushioned as a result of central bank imposing restrictions on gold imports which were announced earlier. The currency touched an intra-day low of 55.02 and closed at 54.82 against dollar on Monday. For the month of May 2013, FII inflows totaled at Rs.8,114.0 crores th ($1,500.31 million) as on 13 May 2013. Year to date basis, net capital th inflows stood at Rs.69,150.0 crores ($12,810.70 million) till 13 May 2013. UKs Royal Institution of Chartered Surveyors (RICS) House Price Balance increased by 1 percent in April as against a decline of 2 percent in March.

Market Highlights (% change)

Last INR/$ (Spot) 54.82 Prev day 0.0

as on 13 May, 2013 w-o-w -1.3 m-o-m -0.5 y-o-y -2.2

$/Euro (Spot)

1.2975

-0.1

-0.8

-0.5

0.5

Dollar Index NIFTY

83.37

0.2

1.2

1.0

4.9

5980.5

-1.9

0.2

7.4

20.4

SENSEX

19691.7

-1.9

0.1

7.3

7.7

DJIA

15091.7

-0.2

0.8

2.3

17.7

S&P

1633.8

0.0

1.0

2.8

20.7

Source: Reuters

The Euro depreciated by 0.1 percent in yesterdays trade on the back of mixed global market sentiments coupled with strength in DX. Further, European Central Bank (ECB) policy maker said that the bank may consider slashing euro deposits rates to negative if required, which added downside pressure on the currency. The Euro touched an intra-day low of 1.2941 and closed at 1.2975 against dollar on Monday.

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Commodities Daily Report

Tuesday| May 14, 2013

International Commodities
Bullion Gold
Spot gold prices declined by 1.2 percent in the yesterdays trading session on the back of strength in DX coupled with mixed global market sentiments. Further, weak economic data from China added downside pressure on the prices. Additionally, SPDR gold trust holding continued to decline, which acted as a negative factor for the prices. The yellow metal touched an intra-day low of $1425.84/oz and closed at $1430.05/oz in yesterdays trading session. In the Indian markets, prices ended on negative note in the yesterday trading session taking cues from spot gold prices and closed at Rs.26854/10 gms after touching an intra-day low of Rs. 26676/10 gms on Monday. Depreciation in the Indian rupee prevented sharp fall in the prices. Market Highlights - Gold (% change)
Gold Gold (Spot) Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (June13) MCX Gold (June13) Unit $/oz Rs/10 gms $/oz Last 1430.1 26715.0 Prev. day -1.2 -0.5 as on 13 May, 2013 WoW -2.6 -2.1 MoM 5.7 1.2 YoY -9.5 -5.9

1430.8

0.3

-2.6

2.6

-9.6

$/oz

1434.5

-0.2

-1.0

3.4

-10.1

Rs /10 gms

26854.0

0.0

-0.9

4.8

-5.3

Source: Reuters

Silver
Taking cues from decline in spot gold prices along with strength in Dollar Index, Spot silver prices fell by 0.9 percent in the yesterdays trading session. Further, mixed global market sentiments added downside pressure. However, favourable economic data from US cushioned sharp downside in the prices. The white metal prices touched an intra-day low of $23.47 /oz and closed at $23.6/oz in yesterdays trade. On the domestic front, prices increased by 0.1 percent on the back of depreciation in the Indian Rupee and closed at Rs. 45118/kg after touching an intra-day high of Rs. 45340/kg on Monday.

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (May13) MCX Silver (May13) Unit $/oz Rs/1 kg Last 23.6 45760.0 Prev day -0.9 1.0

as on 13 May, 2013 WoW -1.6 -1.2 MoM 4.5 -2.8 YoY -18.3 -14.9

$/oz $/ oz

2366.0 2367.0

1.2 0.2

-2.4 -1.0

0.5 0.2

-17.2 -18.0

Rs / kg

45118.0

0.1

-0.1

1.7

-16.7

Source: Reuters

Outlook
In the intraday, we expect precious metals to trade on a negative note on the back of rise in stock markets may led to decline in demand for safe haven. Additionally, SPDR gold trust holding is near to 4 years low, which may keep prices under pressure. However, weakness in DX coupled with expectation of favourable economic data from euro zone may cushion sharp downside in the prices. In the Indian markets, appreciation in the Indian Rupee may add downside pressure on the prices. Technical Outlook
Unit Spot Gold MCX Gold June13 Spot Silver MCX Silver May13 $/oz Rs/10 gms $/oz Rs/kg valid for May 14, 2013 Support 1436/1428 26750/26600 23.60/23.40 44900/44600 Resistance 1447/1453 26950/27050 23.90/24.10 45450/45800

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Tuesday| May 14, 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices declined around 0.9 percent yesterday taking cues from mixed global market sentiments coupled with strength in the DX. Additionally, expectations of rise in the US crude oil inventories from API also exerted downside pressure on the oil prices. However, sharp downside in the crude prices was cushioned as a result of favorable retail sales data from the US. Crude oil prices touched an intra-day low of $94.47/bbl and closed at $95.20/bbl in yesterdays trading session. On the domestic bourses, prices gained by 0.9 percent on account of depreciation in the Indian Rupee and closed at Rs.5,237/bbl after touching an intra-day high of Rs.5246 /bbl on Monday. API Inventories Forecast The American Petroleum Institute (API) is scheduled to release its weekly inventories today and US crude oil inventories are expected to th rise by 0.2 million barrels for the week ending on 10 May 2013. Gasoline stocks are expected to fall by 0.6 million barrels and distillate inventories are expected to shoot up by 0.5 million barrels for the same week. Outlook From the intra-day perspective, we expect crude oil prices to trade higher on the back of rise in risk appetite in the global market sentiments coupled with weakness in the DX. Further, favorable retail sales data from US in yesterdays trade and expectations of positive economic data from Euro Zone will also support an upside in the oil prices.
Source: Telequote

Market Highlights - Crude Oil (% change)

Crude Oil WTI (Spot) Brent (Spot) Nymex Crude (May 13) ICE Brent Crude (May13) MCX Crude (May 13) Unit $/bbl $/bbl $/bbl Last 94.8 102.0 95.2 Prev. day -1.1 0.9 -0.9 WoW -1.1 -3.2 -1.0

as on 13 May, 2013 MoM 6.8 1.5 7.3 YoY -1.3 -9.6 -1.0

$/bbl

102.8

-1.0

-2.5

2.4

-8.4

Rs/bbl

5237.0

0.9

0.8

8.1

1.5
Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (May 13) Unit $/mmbtu Rs/ mmbtu Last 3.937 215.2 Prev. day 0.8 0.0

as on 13 May, 2013

WoW -1.50 -0.74

MoM -7.58 -6.96

YoY 57.86 60.48

Source: Reuters

Technical Chart NYMEX Crude Oil

However, sharp upside in the prices will be capped on account of expectations of rise in US crude oil inventories from API. In the Indian markets, appreciation in the Rupee will prevent sharp upside in the crude oil prices. Technical Outlook
Unit NYMEX Crude Oil MCX Crude May13 $/bbl Rs/bbl valid for May 14, 2013 Support 94.20/93.30 5180/5130 Resistance 96.00/96.80 5280/5320

Technical Chart NYMEX Natural Gas

Source: Telequote

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Commodities Daily Report

Tuesday| May 14, 2013

International Commodities
Base Metals
Market Highlights - Base Metals (% change) The base metals pack traded on a mixed note on the back of mixed global market sentiments coupled with strength in dollar index. Further, mixed LME inventories kept prices under pressure. Additionally, weak economic data from china added downside pressure on the prices. However, rise in US retail sales data cushioned sharp decline in the prices. In the Indian market depreciation in the Indian rupee prevented sharp fall in the prices.
Unit LME Copper (3 month) MCX Copper (April13) LME Aluminum (3 month) MCX Aluminum (April13) LME Nickel (3 month) MCX Nickel (April13) LME Lead (3 month) MCX Lead (April13) Rs /kg 110.1 0.5 -0.3 -0.6 -0.5 $/tonne 2013.3 0.7 -1.7 -1.4 -2.6 Rs /kg 841.4 -0.7 2.8 -1.6 -8.5 $/tonne 15345.0 -0.7 1.2 -2.4 -10.3 Rs /kg 101.7 -0.4 0.8 0.6 -6.3 $/tonne 1863.3 -0.6 -1.4 -0.7 -9.0 Rs/kg 408.6 0.1 3.0 3.2 -5.3 $/tonne Last 7396.0 Prev. day 0.1 as on 13 May, 2013 WoW 1.5 MoM -5.7 YoY -7.6

Copper
Copper, the leader of the base metal pack increased by 0.1 percent on the back of unexpected rise in US retail sales data. However, sharp upside in the prices was capped on the back of strength in DX coupled with mixed global market sentiments. Further, rise in LME inventories by 0.4 percent to 606,700 tonnes prevented sharp rise in the prices. The red metal touched an intra-day high of $7444/tonne and closed at $7396/tonne yesterdays trading session. On the domestic front, prices ended on positive note on the back of depreciation in the Indian Rupee and closed at Rs. 408.6/kg on Monday after touching an intra-day high of Rs 411.6 kg. Outlook

LME Zinc (3 month) MCX Zinc (April13)

$/tonne

1866.0

-0.1

-1.2

-0.2

-3.9

Rs /kg

101.4

-0.2

0.1

0.6

-2.6

Source: Reuters

LME Inventories
Unit Copper tonnes tonnes tonnes tonnes tonnes 13th May 606,700 5,154,175 177,840 1,038,200 243,775 10th May 604,250 5,146,650 178,194 1,043,425 245,425 Actual Change 2,450 7,525 -354 -5,225 -1,650 (%) Change 0.4 0.1 -0.2 -0.5 -0.7
Source: Reuters

In the intra-day, we expect base metals prices to trade on the positive note on the back of rise in risk appetite in the global market sentiments coupled with weakness in DX. Further, unexpected rise in US retail sales data may support price to trade in green. Additionally, expectation of favourable economic data from Euro zone may act as a positive factor for the prices. However, weak economic data from China may prevent sharp rallies in the prices. In the Indian markets, appreciation in the Indian Rupee may cap sharp upside in the prices. Technical Outlook
Unit MCX Copper April13 MCX Zinc April 13 MCX Lead April 13 MCX Aluminum April13 MCX Nickel April 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for May 14, 2013 Support 405/401 100.8/100 109.5/108.8 101/100.4 835/827 Resistance 410/413 102.3/103.2 111/111.8 102.5/103.4

Aluminum Nickel Zinc Lead

Technical Chart LME Copper

Source: Telequote

848/855

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Commodities Daily Report

Tuesday| May 14, 2013

International Commodities
Important Events for Today
Indicator German ZEW Economic Sentiment Industrial Production m/m ZEW Economic Sentiment ECOFIN Meetings Import Prices m/m Country Europe Europe Europe Europe US Time (IST) 2:30pm 2:30pm 2:30pm All Day 6:00pm Actual Forecast 39.5 0.6% 27.3 -0.5% Previous 36.3 0.4% 24.9 -0.5% Impact High Medium Medium Medium Medium

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