Commodities Daily Report

Tuesday| June 18, 2013

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Research Team
Reena Rohit Chief Manager Non-Agri Currencies and Commodities Reena.rohit@angelbroking.com (022) 2921 2000 Extn :6134 Anish Vyas Research Analyst anish.vyas@angelbroking.com (022) 2921 2000 Extn :6104

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Commodities Daily Report

Tuesday| June 18, 2013

International Commodities
Overview
US Empire State Manufacturing Index increased to 7.8-mark in June. RBI kept repo & reverse repo rates at 7.25 % & 6.25 % respectively. European Trade Balance was at a surplus of 16.1 billion Euros in April. Indian government cut the base import prices for gold and silver. Asian markets are trading lower today on the back of decline in foreign direct investment data and leading index from China. Further, investors are waiting for the Federal Reserve decision to curtail its bond buying program or not in a meeting starting from today. US Empire State Manufacturing Index increased to 7.8-mark in June as against a decline of 1.4-level in May. National Association of Home Builders (NAHB) Housing Market Index rose by 8 points to 52-level in current month from previous rise of 44-mark in last month. Indias Reserve Bank of India (RBI) kept the repo rates and reverse repo rates unchanged at 7.25 percent and 6.25 percent respectively. Further, Cash Reserve Ratio (CRR) also remained at 4 percent. Trade Balance was at a deficit of $20.1 billion in May from earlier deficit of $17.8 billion. Exports rose marginally to $24.51 billion in May as compared to $24.16 billion a month ago. Imports grew to $44.65 billion in last month with respect to $41.95 billion in April. Indian government has cut the gold base import price to $450/10 gms from $459/10 gms today. It also reduce the base import price of silver from $737/kg to $709/kg in todays trading session. The US Dollar Index (DX) gained 0.1 percent in yesterdays trading session on the back of rise in risk aversion in global markets in early part of the trade which led to increase in demand for low yielding currency. However, sharp upside in the currency was capped on account of favorable economic data from US coupled with positive movement in US equities. The DX touched an intra-day high of 80.81 and closed at 80.73 on Monday. The Indian Rupee depreciated 1.1 percent in yesterdays trading session. The currency depreciated on account of central bank keeping the key interest rates unchanged. Further, strength in the DX added downside pressure on the currency. However, sharp downside in the Rupee was cushioned as a result of less than forecasted trade deficit data of the country. The currency touched an intra-day low of 58.10 and closed at same levels against dollar on Monday. For the month of June 2013, FII outflows totaled at Rs.1,767.50 crores ($298.05 million) as on 17th June 2013. Year to date basis, net capital inflows stood at Rs.81,437.60 crores ($15,054.90 million) till 17th June 2013. www.angelcommodities.com

Market Highlights (% change)

Last INR/$ (Spot) 58.1 Prev day -1.1

as on 17 June, 2013 w-o-w 0.1 m-o-m -6.1 y-o-y -3.9

$/Euro (Spot)

1.3367

0.2

0.8

3.8

6.3

Dollar Index NIFTY

80.73

0.1

-1.1

-3.7

1.6

5850.1

0.7

-0.5

-5.2

15.7

SENSEX

19325.9

0.8

-0.6

-4.6

5.7

DJIA

15179.9

0.7

-0.4

-1.0

18.9

S&P

1639.0

0.8

-0.2

-1.7

22.1

Source: Reuters

The Euro appreciated 0.2 percent in the yesterdays trading session on the back of favorable economic data from the region. Further, upbeat global markets in the later part of the trade supported an upside in the currency. The Euro touched an intra-day high of 1.3381 and closed at 1.3367 against the dollar on Monday. However, sharp upside in Euro was capped on account of strength in the DX. Italian Trade Balance was at a surplus of 1.91 billion Euros in April as against a earlier surplus of 3.24 billion Euros a month ago. European Trade Balance was at a surplus of 16.1 billion Euros in April from previous surplus of 18.1 billion a month earlier.

Commodities Daily Report

Tuesday| June 18, 2013

International Commodities
Bullion Gold
Market Highlights - Gold (% change) Spot gold prices gained declined 0.4 percent in yesterdays trading session on the back of rise in risk appetite in the global markets which led to fall in safe haven appeal for the commodity. Further, strength in the DX added downside pressure in prices. The yellow metal touched an intra-day low of $1380.44/oz and closed at $1384.40/oz in yesterdays trading session. However, sharp upside in the prices was capped as a result of expectations of that Federal Reserve will reduce its bond buying program. In the Indian markets, prices ended on a positive note, increasing 0.2 percent on account of depreciation in the Rupee and cut in the gold base import prices. The commodity closed at Rs.27869/10 gms after touching an intra-day high of Rs. 27947/10 gms on Monday.
Gold Gold (Spot) Unit $/oz Last 1384.4 Prev. day -0.4 as on 17 June, 2013 WoW -0.1 MoM -0.1 YoY -15.0

Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (August13) MCX Gold (August13)

Rs/10 gms $/oz

27850.0

1.1

0.0

8.0

-7.9

1384.8

-0.5

0.1

0.3

-14.3

$/oz

1382.8

-0.3

0.4

0.4

-15.0

Rs /10 gms

27869.0

0.2

-0.5

6.7

-8.1

Source: Reuters

Silver
Taking cues from fall in gold prices along with strength in the DX, Spot silver prices fell 0.9 percent yesterday. Further, mixed performance in the base metals complex added downside pressure on the prices. The white metal touched an intra-day low of $21.65/oz and closed at $21.80/oz in yesterdays trade. However, sharp downside in prices was prevented on account of favourable economic data from US. On the domestic front, prices dropped 0.4 percent and closed at Rs.43,597/kg after touching an intra-day low of Rs.43,336/kg on Monday.

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (July13) MCX Silver (July13) Unit $/oz Rs/1 kg Last 21.8 44900.0 Prev day -0.9 -0.2

as on 17 June, 2013 WoW -0.3 0.2 MoM -3.6 3.0 YoY -23.9 -18.5

$/oz $/ oz

2187.0 21.8

0.8 -0.9

0.3 -0.7

-1.8 -3.6

-23.1 -24.3

Outlook
In todays trade, we expect precious metals to trade lower on the back of weak global markets coupled with strength in the DX. Further, investors will keep a close watch on the Fed decision regarding curtailing its bond buying program or not in a meeting starting from today. Depreciation in the Rupee will prevent sharp fall in prices on the MCX. Also cut in the base import prices will restrict fall in prices on domestic bourses. Technical Outlook
Unit Spot Gold MCX Gold Aug13 Spot Silver MCX Silver July13 $/oz Rs/10 gms $/oz Rs/kg valid for June 18, 2013 Support 1378/1371 27750/27600 21.80/21.50 43300/42900 Resistance 1390/1394 27980/28080 22.0/22.25 43900/44200

Rs / kg

43597.0

-0.4

-1.3

0.8

-20.6

Source: Reuters

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Tuesday| June 18, 2013

International Commodities
Energy
Market Highlights - Crude Oil (% change)
as on 17 June, 2013 WoW 0.0 2.1 MoM -0.5 1.1 YoY 9.1 16.4

Crude Oil
Crude Oil Unit $/bbl $/bbl Last 104.1 97.8

Nymex crude oil prices declined around 0.1 percent yesterday, taking cues from strength in the DX. Additionally, expectation that Federal Reserve will stop its stimulus spending also exerted downside pressure on prices. Crude oil prices touched an intra-day low of $97.38/bbl and closed at $97.80/bbl in yesterdays trading session. However, sharp downside in prices was capped as a result of unrest in Syria leading to supply concerns from the Middle East. On the domestic bourses, prices gained 0.6 percent and the commodity closed at Rs.5,678/bbl after touching an intra-day high of Rs.5,715/bbl on Monday. Depreciation in the Rupee supported an upside in prices on the MCX. API Inventories Forecast The American Petroleum Institute (API) is scheduled to release its weekly inventories today and US crude oil inventories are expected to decline by 0.6 million barrels for the week ending on 14th June 2013. Gasoline stocks are expected to gain by 0.3 million barrels and distillate inventories are expected to shoot up by 0.4 million barrels for the same week. Outlook From the intra-day perspective, we expect crude oil prices to trade higher on the back of expectations of decline in API crude oil inventories. Additionally, unrest in Syria and other part of the Middle East led to supply concerns from the region supported an upside in the oil prices. Further, investors will keep a close watch on the Fed decision regarding curtailing its bond buying program or not in a meeting starting from today. In the Indian markets, depreciation in the Rupee will support an upside in prices on the MCX. Technical Outlook
Unit NYMEX Crude Oil MCX Crude June13 $/bbl Rs/bbl valid for June 18, 2013 Support 97.0/96.10 5630/5580 Resistance 98.50/99.40 5720/5770

Brent (Spot) Nymex Crude (July 13) ICE Brent Crude (July13) MCX Crude (June 13)

Prev. day -0.2 -0.1

$/bbl

105.5

-0.4

1.5

1.6

9.8

Rs/bbl

5678.0

0.6

1.8

9.0

22.0
Source: Reuters

Market Highlights - Natural Gas

Natural Gas (NG) Nymex NG MCX NG (June 13) Unit $/mmbtu Rs/ mmbtu Last 3.907 224.9

(% change)

as on 17 June, 2013

Prev. day 4.0 4.0

WoW 2.90 1.35

MoM -3.72 -0.49

YoY 58.82 63.33

Source: Reuters

Technical Chart NYMEX Crude Oil

Source: Telequote

Technical Chart NYMEX Natural Gas

Source: Telequote

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Commodities Daily Report

Tuesday| June 18, 2013

International Commodities
Base Metals
The base metals pack traded on mixed note in the yesterdays trading session on the back of mixed LME inventories scenario. Additionally, strength in the DX coupled with expectations of cut in bond buying program from the Fed added downside pressure on the prices. However, sharp downside in prices was cushioned on account of favourable economic data from US. Further, upbeat global markets in the later part of the trade prevented sharp fall in prices. In the Indian markets, depreciation in the Rupee prevented fall in prices on the MCX. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (June13) LME Aluminum (3 month) MCX Aluminum (June13) LME Nickel (3 month) MCX Nickel (June13) LME Lead (3 month) MCX Lead (June13) LME Zinc (3 month) MCX Zinc (June13)
Source: Reuters

as on 17 June, 2013 WoW -1.1 MoM -9.7 YoY -5.6

Last 7087.3

Prev. day -0.1

$/tonne

Rs/kg

409.5

0.5

-1.8

2.2

-2.2

$/tonne

1850.3

-0.6

-3.9

-0.2

-4.0

Rs /kg

105.4

-0.1

-4.5

4.7

-0.9

Copper
Copper prices fell 0.1 percent in yesterdays trade on the back of weak global markets in early part of the trade coupled with strength in the DX. Further, rise in LME copper inventories by 1.8 percent which stood at 629,475 tonnes acted as a negative factor. The red metal touched an intra-day low of $7049.0/tonne and closed at $7087.30/tonne in yesterdays trading session. However, sharp downside in prices was cushioned on account of favourable manufacturing data from US. On the domestic front, prices gained around 0.5 percent as a result of depreciation in the Rupee and closed at Rs. 409.50/kg, after touching an intra-day low of Rs 407.20/kg on Monday. Outlook In todays session, we expect base metal prices to trade with a positive note on the back of expectations of positive economic data from Euro Zone and US. Further, investors will keep a close watch on the Fed decision regarding curtailing its bond buying program or not in a meeting starting from today. However, sharp upside in prices will be capped on account of weak global markets and strength in the DX. In the Indian markets, depreciation in the Rupee will support an upside in prices on the MCX. Technical Outlook
Unit MCX Copper June13 MCX Zinc June 13 MCX Lead June 13 MCX Aluminum June13 MCX Nickel June 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for June 18, 2013 Support 407/403 105.80/105.0 121.30/120.50 104.80/104.0 817/810 Resistance 412/415 107.30/108.0 122.80/123.50 106.20/107.0 830/838

$/tonne

14211.0

-0.6

-4.6

-4.5

-14.7

Rs /kg

823.8

-0.4

-5.0

1.1

-11.6

$/tonne

2109.5

-0.2

-2.4

5.8

11.3

Rs /kg

122.0

0.4

-2.8

11.8

15.2

$/tonne

1863.8

0.2

-1.2

1.7

-1.0

Rs /kg

106.5

0.7

-2.0

7.0

1.2

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 17 June 629,475 5,279,425 183,624 1,083,775 192,600
th

14 June 618,075 5,219,825 183,708 1,087,500 197,350

th

Actual Change 11,400 59,600 -84 -3,725 -4,750

(%) Change 1.8 1.1 0.0 -0.3 -2.4

Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Tuesday| June 18, 2013

International Commodities
Important Events for Today
Indicator ECB President Draghi Speaks CPI y/y PPI Input m/m RPI y/y German ZEW Economic Sentiment ZEW Economic Sentiment Inflation Report Hearings BOE Inflation Letter Building Permits Core CPI m/m CPI m/m Housing Starts G8 Meetings Country Euro UK UK UK Euro Euro UK UK US US US US All Time (IST) 11:30am 2:00pm 2:00pm 2:00pm 2:30pm 2:30pm 2:30pm Tentative 6:00pm 6:00pm 6:00pm 6:00pm Day 2 Actual Forecast 2.6% 0.1% 3.1% 38.2 29.4 0.98M 0.2% 0.1% 0.95M Previous 2.4% -2.3% 2.9% 36.4 27.6 1.01M 0.1% -0.4% 0.85M Impact High High Medium Medium High Medium High High High High Medium Medium High

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