Sushil Finance's Daily Commodity Update

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30 th June,2014 For Private Circulation Only MAJOR INDICES Index Close Previous Close Change % Change DJIA 16851.84 16846.42 5.42 0.03 NASDAQ 4397.93 4379.05 18.88 0.43 HANGSN 9815.17 9804.9 10.27 0.10 NIKKIE 6757.77 6735.12 22.65 0.34 DAX 23221.52 23197.83 23.69 0.10 FTSE 15095 15308.49 -213.49 -1.39 SENSEX 25099.92 25062.67 37.25 0.15 NIFTY 7508.8 7493.2 15.6 0.21 News & Development German Prelim CPI rose to 0.3 percent in June from -0.1 percent in May. United Kingdom (UK) current Account balance fell to -18.5B in First Quarter 2014 from -23.5B in preceding quarter. UK Final GDP rose to 0.8 percent in the First Quarter of 2014. US revised UoM Consumer Sentiment increased to 82.5 levels in June from 81.2 marks in May. Iraq's army sent tanks and armoured vehicles to try to dislodge insurgents from the northern city of Tikrit on Sunday, the second day of a pushback against a Sunni militant takeover of large stretches of Iraq. (Source: Reuters) Japan's factory output rose in May after companies cut production in April to offset the impact of a national sales tax hike, underscoring views the economy will absorb the increase largely unscathed. The 0.5 percent month-on-month rise compared with the median estimate of a 0.9 percent increase in a Reuters poll of economists, and followed a 2.8 percent drop in April, data from the Ministry of Economy, Trade and Industry showed On Monday. (Source: Reuters) After decades of isolation, the United States is set to become a major player in the global trade of ultra light oil as recent government export approvals attract interest across the world. Following rulings disclosed this week, U.S. companies can now export the light, gaseous petroleum known as condensate after a forty-year ban, giving them access to needy markets in Latin America and Asia and potentially threatening the dominance of other established producers in the Middle East and Africa. (Source: Reuters) Chinese importers are turning to purchases of refined copper for near-term delivery to Shanghai as banks tighten credit for buying from bonded stocks following a suspected metal financing scam at China's Qingdao port, trading sources said. (Source: Reuters) Hedge funds and money managers sharply increased their bullish bets in gold futures and options to their highest since March after last week's strong rally in bullion prices, data from the Commodity Futures Trading Commission 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

30th June,2014 For Private Circulation Only

MAJOR INDICES

Index Close Previous Close Change % Change

DJIA 16851.84 16846.42 5.42 0.03

NASDAQ 4397.93 4379.05 18.88 0.43

HANGSN 9815.17 9804.9 10.27 0.10

NIKKIE 6757.77 6735.12 22.65 0.34

DAX 23221.52 23197.83 23.69 0.10

FTSE 15095 15308.49 -213.49 -1.39

SENSEX 25099.92 25062.67 37.25 0.15

NIFTY 7508.8 7493.2 15.6 0.21

News & Development

German Prelim CPI rose to 0.3 percent in June from -0.1 percent in May.

United Kingdom (UK) current Account balance fell to -18.5B in First Quarter 2014 from -23.5B in preceding quarter.

UK Final GDP rose to 0.8 percent in the First Quarter of 2014.

US revised UoM Consumer Sentiment increased to 82.5 levels in June from 81.2 marks in May.

Iraq's army sent tanks and armoured vehicles to try to dislodge insurgents from the northern city of Tikrit on Sunday, the second

day of a pushback against a Sunni militant takeover of large stretches of Iraq. (Source: Reuters)

Japan's factory output rose in May after companies cut production in April to offset the impact of a national sales tax hike,

underscoring views the economy will absorb the increase largely unscathed. The 0.5 percent month-on-month rise compared with

the median estimate of a 0.9 percent increase in a Reuters poll of economists, and followed a 2.8 percent drop in April, data from

the Ministry of Economy, Trade and Industry showed On Monday. (Source: Reuters)

After decades of isolation, the United States is set to become a major player in the global trade of ultra light oil as recent

government export approvals attract interest across the world. Following rulings disclosed this week, U.S. companies can now

export the light, gaseous petroleum known as condensate after a forty-year ban, giving them access to needy markets in Latin

America and Asia and potentially threatening the dominance of other established producers in the Middle East and Africa. (Source:

Reuters)

Chinese importers are turning to purchases of refined copper for near-term delivery to Shanghai as banks tighten credit for buying

from bonded stocks following a suspected metal financing scam at China's Qingdao port, trading sources said. (Source: Reuters)

Hedge funds and money managers sharply increased their bullish bets in gold futures and options to their highest since March after

last week's strong rally in bullion prices, data from the Commodity Futures Trading Commission showed on Friday. (Source: Reuters)

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Commodity Daily

Gold

A spot gold price decreased by 0.19 percent on Friday’s trading session on the back of rise in risk appetite in the global markets. However, weak economic data from US boosted yellow metal safe-haven appeal. Further, weakness in DX and Geopolitical tension in Iraq and ongoing dispute between Russia and Ukraine upsurge the demand for safe haven.

In the Indian Markets, a gold price increased by 0.02 percent on Friday’s trading session taking. Gold prices touched an intraday High of

27799/10gms and closed at 27672/10gms.

Outlook

We expect spot gold prices to trade on the positive note as the Rise in Geopolitical tension in Iraq and ongoing dispute between Russia and Ukraine may upsurge the demand for safe haven. Further, weakness in Dollar after weak economic data from US may support prices to trade in green. Additionally, US Federal Reserve decision to continue with its accommodative monetary policy may act positive for the prices. However, rise in risk appetite in the global markets may cap sharp upside in the prices. Investors will remain cautious ahead of economic data from US and Euro Zone. In the Indian Markets depreciation in the Indian Rupee may support prices.

PERFORMANCE Open High Low Close % Change

MCX Gold 27705 27799 27605 27672 0.02

International Spot Gold

1317.6 1322 1312.45 1315.04 -0.19

Source: Reuters & Sushil Research

Technical Outlook

Strategy Support Resistance

MCX Gold Aug Buy on Dips 27350/27500 27770/27870

Silver A spot Silver price decreased by 0.19 percent on Friday’s trading session on the back of decline in Intl spot gold prices. Additionally, weak economic data from US added downside pressure on the prices. However, weakness in DX and rise in risk appetite in the global markets cushioned sharp fall in the prices. In the Indian Markets, silver prices fell by 0.24 percent taking cues from Intl Spot Silver prices. Further, appreciation in the Indian Rupee added downside pressure on the prices. Silver Prices touched intraday low of 44422/Kg and closed at 44529/Kg

Outlook We expect spot Silver prices to trade on mixed note. Weakness in DX, Strong economic data from China coupled with upside in the Spot gold price may support prices to trade in green. Further, US Federal Reserve committed to retain accommodative monetary policy; this may support Silver Prices. However, weak economic data from US and geopolitical tension in Iraq and ongoing dispute between Russia and Ukraine may keep prices under pressure. In the Indian Markets depreciation in the Indian Rupee may support prices.

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PERFORMANCE

Open High Low Close % Change

MCX Silver

44758 44839 44422 44529 -0.24

International Spot Silver 21.05 21.18 20.9 21.01 -0.19

Source: Reuters & Sushil Research

Technical Outlook

Strategy Support Resistance

MCX Silver July

Sideways 43500/43800 44600/45000

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Commodity Daily

Crude Oil NYMEX Crude oil prices decreased by 0.09 percent on Friday’s trading session as the worries over oil disruption from Iraq due to geopolitical tension eased. Further, OPEC Secretary General commented that there was no shortage of oil in the market, which added downside pressure. Additionally, US economic growth contracted sharply in the first quarter, which kept prices under pressure. However, weakness in DX cushioned sharp downside in the prices.

In the Indian Markets, crude oil price declined by 0.33 percent taking cues from NYMEX Crude oil prices. Further, appreciation in the Indian Rupee added downside pressure on the prices. Crude oil prices touched an intraday low of 6350/bbl. and closed at 6364/bbl.

Outlook

We expect NYMEX crude oil prices to trade on negative note as the worries over oil disruption from Iraq due to geopolitical tension eased. Further, OPEC Secretary General commented that there was no shortage of oil in the market, which may add downside pressure. Additionally, US economic growth contracted sharply in the first quarter, which will keep prices under pressure. However, weakness in DX and rise in risk appetite in the global markets may cushion sharp downside in the prices. In the Indian Markets depreciation in the Indian Rupee may prevent sharp fall in the prices.

PERFORMANCE

Open High Low Close Change

MCX Crude Oil 6385 6410 6350 6364 -0.33

International Crude Oil

105.64 106.19 105.33 105.74 -0.09

Source: Reuters & Sushil Research

Technical Outlook

Strategy Support Resistance

MCX Crude Oil July

Sell on Rallies 6290/6320 6390/6420

Natural Gas

A NYMEX Natural Gas price increased by 0.2 percent on Friday’s trading session on the back of weakness in DX. Further, forecast of warmer temperature supported prices. However, rise in Natural Gas inventory and estimated rise in supply from EIA capped sharp upside in the prices. In the Indian Markets, a Natural gas price decreased by 1.08 percent. Natural Gas prices touched an intraday low of 264/mmbtu and closed at 264.9/ mmbtu.

Outlook We expect NYMEX Natural gas prices to trade on mixed note. Forecast of warmer weather may increase the demand for air conditioning. However, rise in Natural Gas inventory and forecast of rise in supply/record production may add downside pressure on the prices. In the Indian Markets depreciation in the Indian Rupee may cushion sharp fall in the prices.

PERFORMANCE

Open High Low Close Change

MCX Natural Gas

269 269.7 264 264.9 -1.08

International Natural Gas

4.444 4.466 4.375 4.409 0.20

Source: Reuters & Sushil Research

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Technical Outlook

Strategy Support Resistance

MCX Natural Gas June

Sell on Rallies 261.5/263 268/270

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Commodity Daily

30th June, 2014 For Private Circulation Only

PERFORMANCE

Open High Low Close Change

COPPER MCX 420.3 421.85 417.6 417.85 -0.59

COPPER LME 6938.75 6983.75 6927 6933.75 -0.19

LEAD MCX 128.95 129.5 127.85 128 -0.89

LEAD LME 2170.5 2183 2156 2159.25 -0.82

ZINC MCX 131.35 131.6 130.75 131.4 -0.08

ZINC LME 2191 2196.5 2180 2186.75 -0.28

NICKEL MCX 1127.1 1137.9 1119.6 1129.3 -0.26

NICKEL LME 18875 19000 18701 18906 0.01

ALUMINIUM MCX 112 112.2 110.85 111 -0.94

ALUMINIUM LME 1897 1899.75 1881.75 1884 -0.74

Base Metals Base Metals on LME traded on negative note on the back of rise in worries over US economic growth. However, strong economic data from China and US Federal Reserve committed to retain accommodative monetary policy prevented sharp fall in the prices.

LME Copper decreased by 0.619 percent on the back of worries over US economic growth. Further, uncertainty about the impact of an investigation into metal financing at China’s third-largest port kept prices under pressure. However, decline in LME inventory coupled with worries over tight supply prevented sharp decline in the prices.

In the Indian Markets copper prices fell by 0.59 percent taking cues from LME prices. MCX Copper touched an intraday low of 417.6/kg and closed at 417.85/kg

Outlook We expect base metal prices to trade on the positive note on the back of weakness in DX coupled with rise in risk appetite in the global markets. Further, strong economic data from China fueled the expectations among the market participants that the demand for base metal may go up. US Federal Reserve committed to retain accommodative monetary policy which may prove positive for the prices. However, US GDP contracted sharply and even the durable goods orders fell unexpectedly which may prove negative for the prices. Further, uncertainty about the impact of an investigation into metal financing at China’s third-largest port may prevent sharp upside in the prices. In the Indian Markets depreciation in the Indian Rupee may support prices.

Source: Reuters & Sushil Research

Technical Outlook

Strategy Support Resistance

MCX Copper June

Buy on Dips 412/415 420/423

MCX Lead July Buy on Dips

128/128.8 130/131

MCX Zinc July Buy on Dips

130.5 /131.1 132.4/133

MCX Nickel July Buy on Dips

1085/1110 1150/1160

MCX Aluminium July

Buy on Dips 110.8/111.6 113/113.5

Source: Reuters & Sushil Research.

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Commodity Daily

Global Data

Data Country Date Time Actual Expected Previous Impact Prelim Industrial Production m/m

Japan 30/06/2014 5:20am 0.5% 0.9% -2.8% Medium

German Retail Sales m/m Europe 30/06/2014 11:30am - 0.8% -0.9% Medium

Private Loans y/y Europe 30/06/2014 1:30pm - -1.7% -1.8% Medium

Net Lending to Individuals m/m

UK 30/06/2014 2:00pm - 2.5B 2.4B Medium

CPI Flash Estimate y/y Europe 30/06/2014 2:30pm - 0.6% 0.5% High

Core CPI Flash Estimate y/y Europe 30/06/2014 2:30pm - 0.7% 0.7% Medium

Chicago PMI US 30/06/2014 7:15pm - 63.2 65.5 Medium

Pending Home Sales m/m US 30/06/2014 7:30pm - 1.4% 0.4% High

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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