Commodities Daily Report

Monday| August 26, 26 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

Monday| August 26, 26 2013

International Commodities
Overview
LME markets closed today on the eve on Summer Bank Holiday. US New Home Sales declined by 61,000 to 394,000 in the last month. European Consumer Confidence was at -16-mark mark in month of July. UKs Second Estimate GDP rose to 0.7 percent in Q2 of 2013 2013.

Market Highlights (% change)

Last INR/$ (Spot) 63.19 Prev day 2.1

as on 23 August, 2013 w-o-w -2.5 m-o-m -6.7 y-o-y -12.2

Asian markets are trading higher today on the back of unfavorable economic data from US on Friday which eased concerns of QE tapering from the Federal Reserve. w Home Sales declined by 61,000 to 394,000 in July as against a US New rise of 455,000 in June. The US Dollar Index (DX) appreciated marginally around 0.2 percent in the last week on the back of rise in risk aversion in global market sentiments which led to rise in demand for the low yielding currency. Further, statement from Federal Reserve Chairman Ben Bernanke and its members that QE tapering is possible by end of the year if economy improves which supported an upside in the currency. However, sharp upside in currency was capped on account of more than expected rise in initial jobless claims data, which showed signs of slow economic growth. The currency touched a weekly high of 81.95 and closed at 81.392 on Friday. On a weekly basis, Indian Rupee depreciated around 3 percent. The currency depreciated on the back of concerns regarding Current Account Deficit (CAD) and economy growth of the country. Additionally, downgrade of Indias equities from overweight to neutral by major investment bankers acted as a negative factor. Further, outflow of foreign funds from equities and debt exerted downside pressure on the Rupee. Also, Fitch credit rating agency has warned the Indian government that a downgrade is possible as investors confidence is low. Indias credit rating is just once nce notch above junk category. The currency touched a weekly low of 65.56 and closed at 63.19 on Friday. For the month of August 2013, FII outflows totaled at Rs.1668.50 crores nd ($255.73 million) as on 22 August 2013. Year to date basis, net capital nd inflows flows stood at Rs.64423.80 crores ($12230.10 million) till 22 August 2013. Japans Corporate Services Price Index (CSPI) remained unchanged at 0.4 percent in the month of July.

$/Euro (Spot)

1.3381

0.2

0.4

1.4

7.0

Dollar Index NIFTY

81.39

-0.2 0.2

0.1

-0.5

2.4

5471.8

1.2

-8.7

-8.7

1.1

SENSEX

18519.4

1.1

-7.8

-7.8

1.3

DJIA

15010.5

0.3

-0.5

-3.3

15.0

S&P

1663.5

0.4

-1.7

-1.7

18.6

Source: Reuters

The Euro gained around 0.3 percent in the last week taking cues from favorable economic data from the region. However, sharp upside in the currency was capped as a result of fall in global market sentiments coupled with strength in the DX. The Euro touched a weekly high of 1.3452 1. and closed at 1.3381 on Friday. European Consumer Confidence was at -16-mark in July from 17-level a month ago. UKs Second Estimate Gross Domestic Product (GDP) rose to 0.7 percent in Q2 of 2013 as against a rise of 0.6 percent in Q1 of 2013. British Bankers' Association (BBA) Mortgage Approvals was at 37,200 in July from 37,300 a month ago. Prelim Business Investment rose by 0.9 percent in second quarter of 2013 with respect to fall of 1.9 percent in first quarter of 2013.

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Commodities Daily Report

Monday| August 26, 26 2013

International Commodities
Bullion Gold
Market Highlights - Gold (% change) Spot gold prices increased around 1.5 percent in the last week on the back of rise in SPDR gold holdings by 0.5 percent to 920.13 tonnes as rd on 23 August 2013. Further, rise in physical demand from India and mainly in China supported an upside in prices. However, sharp upside in prices was capped as a result of strength in the DX coupled with downside in global market sentiments. The yellow metal touched a weekly high of $1399.71/oz /oz and closed at $1396.35/oz in last trading session of the week. dian markets, prices rose around 3.7 percent due to In the Indian depreciation in the Rupee and closed at Rs.31,905/10 gms on Friday after touching a weekly high of Rs.31950/10 gms.
Gold Gold (Spot) Unit $/oz Last 1396.4 Prev. day 1.5 as on 23 August, 2013 WoW 1.5 MoM 5.7 YoY -16.4

Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (Oct13) MCX Gold (Oct13)

Rs/10 gms $/oz

31200.0

-0.6

13.0

13.0

4.7

1377.5

0.1

0.6

3.2

-17.4

$/oz

1395.7

1.8

2.2

5.4

-16.4

Rs /10 gms

31905.0

2.5

3.7

17.1

3.3

Source: Reuters

Silver
Taking cues from rise in gold prices along with favorable economic data from major jor global economies, Spot silver prices rose around 3.2 percent in the last week. However, strength in the DX coupled with downside in base metals group prevented sharp upside in prices. The white metal touched a weekly high of $24.08/oz /oz and closed at $23.95/oz in last trading session of the week. On the MCX, Silver September contract increased by more than 5 percent in previous week on account of Rupee depreciation and closed at Rs.53,469/kg on Friday after touching a high of Rs. Rs.53620/kg in the last week. Market Highlights - Silver (% change)
Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (Sept13) MCX Silver (Sept13) Unit $/oz Rs/1 kg Last 24.0 52000.0 Prev day 3.6 -0.9 as on 23 August, 2013 WoW 3.2 22.9 MoM 18.9 22.9 YoY -22.2 -4.9

$/oz $/ oz

2306.0 23.7

0.0 3.1

1.0 2.5

13.1 20.7

-24.1 -22.5

Rs / kg

53469.0

4.4

5.1

29.3

-6.1

Outlook
Technical Chart Spot Gold In todays session, we expect precious metals to trade higher on the back of weakness in the DX. Further, upbeat global market sentiments coupled with rise in SPDR gold holdings and increase in iShares Silver Trust will support an upside in the prices. In the Indian markets, appreciation in the Rupee will cap sharp gains in prices on the MCX. Technical Outlook
Unit Spot Gold MCX Gold Oct13 Spot Silver MCX Silver Sept13 $/oz Rs/10 gms $/oz Rs/kg valid for August 26, 2013 Support 1386/1379 31600/31440 23.75/23.50 52800/52400 Resistance 1399/1407 31900/32080 24.20/24.50 53800/54300

Source: Reuters

Source: Telequote

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Commodities Daily Report

Monday| August 26, 26 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices declined around 1 percent in the last week on the back of statement from Federal Reserve Chairman Ben Bernanke and its members that QE tapering is possible by end of the year if economy improves. Additionally, Libya restarted its pr production along with strength in the DX exerted downside pressure on prices However, sharp downside in prices was cushioned as a result of fall in crude oil inventories coupled with favorable economic data from major global economies. Crude oil prices touched hed a weekly low of $ $103.5/bbl and closed at $106.42/bbl in last trading session of the week. On the MCX near-month month contract, oil prices rose around 2.7 percent as a result of depreciation in the Rupee and closed at Rs.6881/bbl on Friday after touching a high of Rs.6927/bbl /bbl in the prior week. Market Highlights - Crude Oil (% change)
Crude Oil Brent (Spot) Nymex Crude (Sep 13) ICE Brent Crude (Sep13) MCX Crude (Aug 13) Unit $/bbl $/bbl Last 114.1 106.4 Prev. day 1.4 1.3 WoW 0.3 -1.0 as on 23 August, 2013 MoM 4.4 1.8 YoY -2.1 10.5

$/bbl

111.0

1.0

0.6

3.6

-2.2

Rs/bbl

6837.0

1.6

2.1

9.1

27.9

Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (Aug 13) Unit $/mmbtu Rs/ mmbtu Last 3.485 224.9 Prev. day -1.7 -1.2

as on 23 August, 2013 MoM -6.54 0.99 YoY 23.54 44.17

Source: Reuters

WoW 3.35 6.34

Natural Gas
On a weekly basis, Nymex natural gas prices rose around 3.3 percent on the back of less than expected rise in US natural gas inventories. However, strength in the DX capped sharp gains in the prices. Gas prices touched a weekly high of $3.562/mmbtu /mmbtu and closed at $3.485/mmbtu in last trade of previous week. On the MCX, prices gained around 6.3 percent on account of Rupee depreciation and closed at Rs.224.90/mmbtu on Friday. Outlook From the intra-day perspective, we expect crude oil prices to trade on a higher note on the back of unfavorable economic data from US on Friday led to expectations that QE tapering likely to delay on account of slow economic growth. Further, weakness in the DX coupled with upbeat global market sentiments will support an upside in prices. Additionally, forecast for rise in US core durable goods orders which will act as a positive factor for prices. On the other hand, restart of production in Libya will cap sharp gains in prices. In the Indian markets, appreciation in the Rupee will cap sharp gains in crude oil prices on the MCX. Technical Outlook
Unit NYMEX Crude Oil MCX Crude Aug13 $/bbl Rs/bbl valid for August 26, 2013 Support 105.80/105.00 6770/6720 Resistance

Technical Chart NYMEX Crude Oil

Source: Telequote

Technical Chart NYMEX Natural Gas

Source: Telequote

107.40/108.30 6870/6930

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Commodities Daily Report

Monday| August 26, 26 2013

International Commodities
Base Metals
The base metals pack traded on a negative note in the last week on the back of statement from Federal Reserve Chairman and its members that QE tapering might be possible by end of the year coupled with strength in the DX. Additionally, weak global market sentiments, fall in new home sales data along with rise in US jobless claims data exerted downside pressure on prices However, sharp downside in prices was cushioned as a result of decline in LME inventories coupled with favorable manufacturing data from China, Euro Zone and US. In the Indian markets, depreciation in the Rupee supported an upside in the prices. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (Aug13) LME Aluminum (3 month) MCX Aluminum (Aug13) LME Nickel (3 month) MCX Nickel Rs /kg 928.5 0.6 -0.5 9.7 1.9 $/tonne 14535.0 0.9 -2.3 1.5 -11.9 Rs /kg 119.4 0.9 -0.1 11.2 13.9 $/tonne 1897.5 0.8 -2.4 2.8 -1.1 Rs/kg 474.9 1.0 2.2 13.2 11.6 $/tonne Last 7353.0 as on 23 August, 2013 WoW -0.3 MoM -6.3 YoY -4.0

Prev. day 0.8

Copper
Copper prices on the LME declined around 0.3 percent in the last week on the back of weak global markets along with stronger DX. However, sharp downside in prices was cushioned on account of fall in LME and Shanghai inventories coupled with increase in manufacturing economic data from major global economies. Copper prices touched a weekly low of $7,227/tonne /tonne and closed at $7,353/tonne in last trade of the week. On the MCX, the near-month copper contract gained by more than 2 percent as a result of depreciation in the Rupee and closed at Rs.474.90/kg on Friday after touching a high of Rs.483.2 .483.2/kg in the last week. Outlook In todays session, we expect base metals prices to trade on a positive note on the back of upbeat global market sentiments after ease in QE tapering concerns from the Federal Reserve Reserve. Further, weakness in the DX along with upbeat market sentiments will support an upside in prices. However, less volatility will be observed as LME markets are closed today on eve of Summer Bank Holiday. In the Indian markets, appreciation in the Rupee will restrict sharp gains in prices on the MCX. Technical Outlook
Unit MCX Copper Aug13 MCX Zinc Aug 13 MCX Lead Aug 13 MCX Aluminum Aug13 MCX Nickel Aug 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for August 26, 2013 Support 470/466 124.20/123.50 141.20/140.40 118.50/117.70 921/914 Resistance 478/481 126.30/127.20 143.30/144.40 120.20/121.00 935/942

(Aug13) LME Lead (3 month) MCX Lead (Aug13) LME Zinc (3 month) MCX Zinc (Aug13)
Source: Reuters

$/tonne

2229.0

0.9

-0.9

8.0

13.1

Rs /kg

142.3

1.1

1.1

16.6

31.0

$/tonne

1987.3

0.9

-0.8

5.5

6.0

Rs /kg

125.3

1.0

1.3

13.7

21.8

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 23rd August 564,225 5,428,175 210,060 1,023,575 187,850 22nd August 565,500 5,431,600 209,868 1,026,100 186,625 Actual Change -1,275 -3,425 192 -2,525 1,225 (%) Change -0.2 -0.1 0.1 -0.2 0.7
Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Monday| August 26, 26 2013

International Commodities
Important Events for Today
Indicator Country Time (IST) Actual Forecast Previous Impact

Bank Holiday Core Durable Goods Orders m/m Durable Goods Orders m/m

UK US US

All day 6:00pm 6:00pm

0.6% -3.0%

-0.1% 0.1% 3.9%

High Medium

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