Commodities Daily Report

Thursday| August 9, 2012

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Overview:

Research Team
Nalini Rao - Sr. Research Analyst nalini.rao@angelbroking.com (022) 2921 2000 Extn. 6135 Anish Vyas - Research Associate anish.vyas@angelbroking.com (022) 2921 2000 Extn. 6104

Angel Commodities Broking Pvt. Ltd. Registered Office: G-1, Ackruti Trade Centre, Rd. No. 7, MIDC, Andheri (E), Mumbai - 400 093. Corporate Office: 6th Floor, Ackruti Star, MIDC, Andheri (E), Mumbai - 400 093. Tel: (022) 2921 2000 MCX Member ID: 12685 / FMC Regn No: MCX / TCM / CORP / 0037 NCDEX: Member ID 00220 / FMC Regn No: NCDEX / TCM / CORP / 0302

Disclaimer: The information and opinions contained in the document have been compiled from sources believed to be reliable. The company does not warrant its accuracy, completeness and correctness. The document is not, and should not be construed as an offer to sell or solicitation to buy any commodities. This document may not be reproduced, distributed or published, in whole or in part, by any recipient hereof for any purpose without prior permission from Angel Commodities Broking (P) Ltd. Your feedback is appreciated on commodities@angelbroking.com

www.angelcommodities.com

Commodities Daily Report

Thursday| August 9, 2012

International Commodities
Overview
US Prelim Nonfarm Productivity increased 1.6 percent in Q2 of 2012. French Trade Balance was at a deficit of 6 billion Euros in June. Japans Core Machinery Orders increased by 5.6 percent in June. LME Copper inventories rose by 0.2 percent in yesterdays trade. German Industrial Production declined by 0.9 percent in June. US crude oil inventories declined by 3.7 mn bbl for w/e 3 Aug - EIA.
rd

Market Highlights (% change)

Last INR/$ (Spot) 55.28 Prev day -0.4

as on 8 August, 2012

w-o-w 0.3

m-o-m 0.4

y-o-y -18.2

Asian markets are trading on mixed note as investors are awaiting policy rate decision from Bank of Japan and consumer price index data from the China increased at slow pace for the month of July. US Prelim Nonfarm Productivity increased by 1.6 percent in Q2 of 2012 as against a decline of 0.9 percent in Q1 of 2012. Prelim Unit Labor Costs gained by 1.7 percent in Q2 of 2012 from previous rise of 1.3 percent in prior quarter. Chinas Consumer Price Index (CPI) increased at slow pace of 1.8 percent in July from previous rise of 2.2 percent in June. Producer Price Index (PPI) declined by 2.9 percent in last month as compared to previous decline of 2.1 percent in June. US Dollar Index strengthened by 0.2 percent due to rise in the risk aversion in the global markets which increased the demand for the low yielding currency that is US Dollar Index. US equities settled on a mixed note due to diverse company result news amidst concerns of global deceleration. Initially strength was seen in the US equities due to expectation that global central bankers might take stimulus measures to boost the economy. The currency touched an intraday high of 82.57 and closed at 82.44 on Wednesday. The Indian Rupee swung between gains and losses and depreciated around 0.4 percent in yesterdays trading session. The currency declined on the back of weak global market sentiments in the second half of the trade along with unfavorable economic data from the country. Additionally, Indias M3 money supply declined by 0.8 percent to 13.5 percent in first half for the month of August. However, sharp downside in the currency was cushioned on the back of selling of dollars from foreign banks and exporters coupled with rise in FIIs inflows. It touched an intraday low of 55.41 in yesterdays trading session and closed at same levels on Wednesday. For the current month, FII inflows totaled at Rs 3,338.60 crores till 8 August 2012. While on a year to date basis, net capital inflows stood at Rs 55,604.40 crores till 8th August 2012.
th

$/Euro (Spot)

1.2364

-0.3

1.1

1.0

-13.9

Dollar Index

82.44

0.2

-0.9

-1.5

10.3

NIFTY

5338.0

0.0

1.9

0.6

5.2

SENSEX

17600.6

0.0

2.0

0.6

4.4

DJIA

13175.6

0.1

1.6

4.5

17.2

S&P

1402.2

0.1

2.0

3.5

25.3

Source: Reuters

Euro depreciated 0.3 percent due to concerns of piling Euro zone debt along with strength in the DX. Additionally, unfavorable economic data from the region also added to the losses of the currency. The currency touched an intra-day low of 1.2325 and closed at 1.2364 on Wednesday. German Trade Balance was at surplus of 16.2 billion Euros in June as against a previous surplus of 15 billion Euros a month ago. French Trade Balance was at a deficit of 6 billion Euros in June from previous deficit of 5.3 billion Euros in May. German Industrial Production declined by 0.9 percent in June as compared to rise of 1.6 percent in prior month. Japans Core Machinery Orders increased by 5.6 percent in June as against a decline of 14.8 percent a month ago. M2 Money Stock remained unchanged at 2.2 percent in July.

www.angelcommodities.com

Commodities Daily Report

Thursday| August 9, 2012

International Commodities
Bullion
Gold
Spot gold prices traded range bound throughout the day and settled at the same levels as that of previous day tracking global market sentiments. Additionally, strength in the DX also acted as a bearish factor for the gold prices. The yellow metal touched an intraday low of $1602.9/oz and settled at $1,611.3/oz in yesterdays session. In the domestic markets however, gold prices increased 0.4 percent on the back of depreciation in the Indian Rupee and closed at Rs.29,896/10gms after touching a high of Rs.29,919/10 gms on Wednesday. Market Highlights - Gold (% change)
Gold Gold (Spot) Gold (Spot Mumbai) Gold (LBMAPM Fix) Comex (Dec12) MCX (Oct12) Unit $/oz Rs/10 gms $/oz $/oz Rs /10 gms Last 1611.3 29725.0 Prev day 0.0 0.1 as on 8 August, 2012 WoW 0.8 -0.3 MoM 2.2 2.1 YoY -7.6 15.7

1613.3 1612.9 29896.0

0.1 0.2 0.4

0.9 0.6 1.0

2.3 2.4 2.2

-7.1 -7.3 16.2

Source: Reuters

Silver
Spot silver prices declined 0.3 percent taking cues from the weakness in the Spot gold prices along with bearishness in the base metals pack. Additionally, strength in the DX also led to decline in the silver prices. The white metal touched an intra-day low of $27.70/oz and settled $27.99/oz in yesterdays session. In the domestic markets MCX silver gained by 0.1 percent due to depreciation of the Indian rupee. Silver prices on MCX touched an intra-day high of Rs.53620/kg on Wednesday.

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot -Mumbai) Silver (LBMA) Comex (Sep12) MCX (Sep12) Unit $/oz Rs/1 kg $/oz $/ oz Rs / kg Last 28.0 53810.0 2786.0 2806.7 53409.0 Prev day -0.3 0.1 -0.5 0.0 0.1

as on 8 August, 2012 WoW 2.2 -0.4 0.0 2.0 0.4 MoM 3.3 2.1 2.8 4.0 1.3 YoY -25.6 -9.1 -27.4 -25.9 -7.0

Source: Reuters

Outlook
From the intra-day perspective, we expect precious metals to trade on a positive note on the back of upbeat global market sentiments along with weakness in the DX. However, depreciation in the Indian Rupee will further support upside in prices on the MCX. Technical Outlook
Unit valid for August 9, 2012 Support Resistance

Technical Chart Spot Gold

Spot Gold

$/oz

1615/1609

1623/1627

MCX Gold Oct12

Rs/10 gms

29850/29750

30000/30080
Source: Telequote

Spot Silver

$/oz

28.05/27.90

28.25/28.40

MCX Silver Sep12

Rs/kg

53200/53000

53600/53800

www.angelcommodities.com

Commodities Daily Report

Thursday| August 9, 2012

International Commodities
Energy
Crude Oil
Nymex crude oil prices declined around 0.3 percent yesterday taking cues from decline in US crude consumption which fell by 4 percent to 15.9 million barrels a day last week, the biggest percentage decrease in a month as per the American Petroleum Institute report coupled with strength in the DX. However, sharp downside in prices was cushioned on account of more than expected decline in US crude oil inventories. Crude prices touched an intra-day low of $92.82/bbl and closed at $93.40/bbl in yesterdays trading session. On the domestic bourses, prices declined around 0.1 percent and closed at Rs.5,169/bbl after touching an intra-day low of Rs.5,131/bbl on Wednesday. However depreciation in the Indian Rupee cushioned sharp fall in prices on the MCX. EIA Inventories Data As per the US Energy Department (EIA) report last night, US crude oil inventories decline more than expected by 3.7 million barrels to 369.90 million barrels which for the week ending on 3rd August 2012. Gasoline stocks fell by 1.8 million barrels to 206.1 million barrels and whereas distillate stockpiles also dropped by 0.7 million barrels to 123.50 million barrels for the last week. Outlook We expect crude oil prices to trade higher on account of more than expected decline in US crude oil inventories coupled with weakness in the DX. Additionally, expectations that China will take measures to boost the economy will support upside in prices. In the Indian markets depreciation in the Rupee will act as a positive factor for the crude oil prices. Technical Outlook
Unit valid for August 9, 2012

Market Highlights - Crude Oil (% change)

Crude Oil WTI (Spot) Brent (Spot) Nymex Crude (Aug12) ICE Brent Crude (Aug12) MCX Crude (Aug12) Unit $/bbl $/bbl Last 93.4 114.2 Prev. day -0.3 0.9 WoW 4.9 6.2

as on 8 August, 2012 MoM 8.7 14.5 YoY 17.7 9.3

$/bbl

93.4

-0.3

5.0

8.8

17.7

$/bbl

112.1

0.1

5.8

11.9

9.3

Rs/bbl

5169.0

-0.1

3.8

8.3

41.1

Source: Reuters

Market Highlights - Natural Gas

Natural Gas (NG) Nymex NG MCX NG (Aug12) Unit $/mmbtu Rs/ mmbtu Last 2.926 161.7

(% change)

as on 8 August, 2012

Prev. day -1.08 -1.16

WoW -7.23 -7.92

MoM 4.87 2.54

YoY -26.02 -9.56

Source: Reuters

Technical Chart Nymex Crude Oil

Source: Telequote

Technical Chart Nymex Natural Gas

Support

Resistance

NYMEX Crude Oil

$/bbl

92.65/91.70

94.30/94.90

MCX Crude Aug12

Rs/bbl

5120/5070

5210/5240
Source: Telequote

www.angelcommodities.com

Commodities Daily Report

Thursday| August 9, 2012

International Commodities
Base Metals
The base metals pack traded on a negative note yesterday on the back of rise in risk aversion in the global markets coupled with strength in the DX. However, sharp downside in prices was cushioned on account of decline in LME inventories expect Copper. In the Indian markets depreciation in the Rupee restricted sharp downside in the prices. Copper Copper, the leader of the base metals pack declined around 0.8 percent yesterday taking cues from mixed global market sentiments coupled with strength in the DX. Additionally, rise in LME copper inventories by 0.2 percent which stood at 245,600 tonnes also exerted downside pressure on the prices. The red metal touched an intra-day low of $7,504/tonne and closed at $7,525/tonne in yesterdays trading session. In the Indian markets prices fell by 0.3 percent and closed at Rs.417.20/kg after touching an intra-day low of Rs.416.10/kg on Wednesday. However, depreciation in the Indian Rupee prevented further fall in the prices on the MCX. Outlook In todays trading session, we expect base metals pack to trade on a positive note on the back of positive market sentiments along with weakness in the DX which will support an upside in the prices. Additionally, expectations that China will take measures to boost the economy will support upside in prices. Depreciation in the Indian Rupee will lead to further gains in the prices on the MCX. Technical Outlook
Unit valid for August 9, 2012 Support Resistance

Market Highlights - Base Metals (% change)

Unit LME Copper (3 month) MCX Copper (Aug12) LME Aluminum (3 month) MCX Aluminum (Aug12) LME Nickel (3 month) MCX Nickel (Aug12) LME Lead (3 month) MCX Lead (Aug12) LME Zinc (3 month) MCX Zinc (Aug12) Rs /kg 102.8 $/tonne 1858.0 Rs /kg 105.4 $/tonne 1905.5 Rs /kg 871.0 $/tonne 15667.0 Rs /kg 104.5 $/tonne 1905.0 Rs/kg 417.2 $/tonne Last 7525.0

as on 8 August, 2012 WoW 1.1 MoM -0.6 YoY -14.1

Prev. day -0.8

-0.3

0.1

-1.3

4.9

0.0

2.3

0.2

-21.0

0.7

0.8

-0.3

-3.8

-0.8

0.5

-3.1

-26.3

-0.3

-0.8

-3.4

-9.9

0.0

1.0

1.9

-16.0

0.3

-0.1

1.2

2.3

-0.5

2.3

0.5

-12.2

0.0

0.9

-0.2

7.7

Source: Reuters

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 8 August 245,600 4,868,850 116,604 986,125 324,875
th

7 August 245,050 4,874,650 116,670 988,625 326,025

th

Actual Change 550 -5,800 -66 -2,500 -1,150

(%) Change 0.2 -0.1 -0.1 -0.3 -0.4

Source: Reuters

Technical Chart LME Copper

MCX Copper Aug12

Rs /kg

415/411

420/422

MCX Zinc Aug12

Rs /kg

102.20/101.50

103.40/104.0

MCX Lead Aug12

Rs /kg

104.80/104.40

105.90/106.50

MCX Aluminum Aug12

Rs /kg

104.0/103.60

105.20/105.80

MCX Nickel Aug12

Rs /kg

867/863

878/885

Source: Telequote

www.angelcommodities.com

Commodities Daily Report

Thursday| August 9, 2012

International Commodities
Important Events for Today

Indicator Core Machinery Orders m/m CPI y/y PPI y/y Monetary Policy Statement Overnight Call Rate Fixed Asset Investment ytd/y Industrial Production y/y BOJ Press Conference ECB Monthly Bulletin Trade Balance Trade Balance Unemployment Claims

Country Japan China China Japan Japan China China Japan Euro UK US US

Time (IST) 5:20am 7:00am 7:00am Tentative Tentative 11:00am 11:00am Tentative 1:30pm 2:00pm 6:00pm 6:00pm

Actual 5.6% 1.8% -2.9% -

Forecast 11.3% 1.7% -2.6% <0.10 20.6% 9.8% -8.5B -47.4B 371K

Previous -14.8% 2.2% -2.1% <0.10% 20.4% 9.5% -8.4B -48.7B 365K

Impact Medium High Medium High High Medium Medium High Medium Medium High High

www.angelcommodities.com