Commodities Daily Report

Tuesday| March 19, 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| March 19, 2013

International Commodities
Overview
Italian Trade Balance was at a deficit of 1.62 billion Euros in January. US NAHB Housing Market Index declined to 44-mark in March. European Trade Balance was at a surplus of 9 billion Euros in January. Asian markets recovered from yesterdays fall which had slipped on the back of expectations that Euro region will fall into its debt crisis. US National Association of Home Builders (NAHB) Housing Market Index declined by 2 points to 44-mark in March as against a rise of 46-level in February. Chinas Conference Board (CB) Leading Index remained unchanged at 1.3 percent in the month of February. Foreign Direct Investment fell by 1.4 percent in February as against a previous decline of 7.3 percent in January. US Dollar Index (DX) appreciated by 0.4 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. Additionally, tax levied on the bank deposits in Cyprus which is plan of bailout package led to expectations of reemergence in the Euro Zone debt crisis. Further, US equities traded on a negative which also acted as a favorable factor for the DX. The currency touched an intra-day high of 82.83 and closed at 82.574 on Monday. The Indian Rupee depreciated by 0.1 percent in yesterdays trading session. The currency depreciated on the back of weak global and domestic market sentiments after bailout plan for Cyprus levied tax on bank deposits which led to reemergence of Euro Zone debt crisis. However, sharp downside in the currency was cushioned on account of expectations of cut in interest rates by the central bank of the country on Tuesday. The Indian Rupee touched an intra-day low of 54.34 and closed at 54.07 against dollar on Monday. For the month of March 2013, FII inflows totaled at Rs.6,613.40 crores th ($1,212.41 million) as on 18 March 2013. Year to date basis, net capital th inflows stood at Rs.53,111.60 crores ($9,847.0 million) till 18 March 2013.

Market Highlights (% change)

Last INR/$ (Spot) 54.07 Prev day -0.1

as on 18 March, 2013 w-o-w 0.5 m-o-m 0.3 y-o-y -7.3

$/Euro (Spot)

1.2954

-0.9

-0.7

-3.0

-1.7

Dollar Index NIFTY

82.57

0.4

0.0

2.5

3.9

5835.3

-0.6

-1.8

-1.1

11.0

SENSEX

19293.2

-0.7

-1.8

-1.1

5.5

DJIA

14452.1

-0.4

0.0

3.0

9.2

S&P

1552.1

-0.6

-0.3

2.1

10.5

Source: Reuters

The Euro depreciated by 0.9 percent in yesterdays trade on the back of worries over Cyprus bailout as the European Finance Ministers decided to levy special tax on the bank deposits of Cyprus. Further, weak global market sentiments coupled with strength in DX added downside pressure on the currency. Italian Trade Balance was at a deficit of 1.62 billion Euros in January as against a previous surplus of 2.11 billion Euros a month ago. European Trade Balance was at a surplus of 9 billion Euros in January from earlier surplus of 10.3 billion in December. The Euro touched an intra-day low of 1.288 and closed at 1.2954 against dollar on Monday.

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Commodities Daily Report

Tuesday| March 19, 2013

International Commodities
Bullion Gold
Spot gold prices increased by 0.8 percent in the yesterday trading session on the back of worries over Cyprus bailout, driving investors to buy gold as safe haven . However, strength in DX capped sharp gains in prices. The yellow metal touched an intra-day high of $1610.81/oz and closed at $1604.8/oz in yesterdays trading session. In the Indian markets, prices ended on positive note in the yesterday trading session on the back of depreciation in the Indian rupee and closed at Rs.29547/10 gms after touching an intra-day high of Rs. 29644/10 gms on Monday. Market Highlights - Gold (% change)
Gold Gold (Spot) Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (April13) MCX Gold (April13) Unit $/oz Rs/10 gms $/oz Last 1604.8 29525.0 Prev. day 0.8 0.6 as on 18 March, 2013 WoW 1.5 0.9 MoM -0.3 -0.7 YoY -3.3 7.2

1603.8

0.5

1.6

-0.4

-3.3

$/oz

1604.6

0.9

1.7

0.1

-3.3

Rs /10 gms

29547.0

0.6

0.8

-2.1

6.1

Silver
Source: Reuters

Taking cues from rise in gold prices, spot silver prices ended on positive note by 0.4 percent on Monday. However, weak global market sentiments coupled with strength in DX capped sharp upside movement in the prices. The white metal prices touched an intra-day high of $29.12 /oz and closed at $28.8/oz in yesterdays trade. On the domestic front, prices ended on a positive note by 0.2 percent and closed at Rs. 54321/kg after touching an intra-day high of Rs. 54555/kg on Monday. Depreciation in the Indian rupee supported prices to trade green.

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (May13) MCX Silver (May13) Unit $/oz Rs/1 kg Last 28.8 54750.0 Prev day 0.4 0.3

as on18 March, 2013 WoW -0.4 -1.5 MoM -3.7 -4.8 YoY -11.3 -3.4

$/oz $/ oz

2880.0 2884.1

-0.4 0.1

-0.3 0.1

-4.0 -1.9

-10.8 -11.5

Outlook
In the intraday, we expect precious metals to trade on a positive note due to worries over Cyprus bailout and expectation of rise in Inflation data from UK will lead to increase in demand for the safe haven investment. Further, weakness in DX may support prices to trade positive. Appreciation in the Indian Rupee will cap sharp gains in the prices on the MCX. Technical Outlook
Unit Spot Gold MCX Gold Apr13 Spot Silver MCX Silver May13 $/oz Rs/10 gms $/oz Rs/kg valid for March 19, 2013 Support 1597/15952 29440/29340 28.75/28.60 54060/53800 Resistance 1609/1614 29650/29750

Rs / kg

54321.0

0.2

-0.5

-3.4

-5.1

Source: Reuters

Technical Chart Spot Gold

Source: Telequote

29.00/29.15 54550/54800

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Commodities Daily Report

Tuesday| March 19, 2013

International Commodities
Energy
Market Highlights - Crude Oil (% change)
as on 18 March, 2013 WoW 1.8 -0.1 1.8 MoM -7.5 -3.0 YoY -12.4 -13.1 -12.4

Crude Oil
Crude Oil Unit $/bbl $/bbl $/bbl Last 93.7 109.7 93.7

Nymex crude oil prices recovered from its losses and increase by 0.3 percent yesterday taking cues from shutdown in the crude pipeline in Libya after the protests by the fuel truck drivers. However, sharp upside in the prices was capped on account of weak global market sentiments, concerns for the Euro Zone debt crisis along with strength in the DX. Crude oil prices touched an intra-day high of $93.94/bbl and closed at $93.70/bbl in yesterdays trading session. On the domestic bourses, prices declined by 0.1 percent and closed at Rs.5,056/bbl after touching an intra-day low of Rs.4,973/bbl on Monday. Depreciation in the Indian Rupee cushioned sharp fall in the 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 rise by 2.0 million barrels for the week ending on 15th March 2013. Gasoline stocks are expected to decline by 2.5 million barrels and distillate inventories are expected to fall by 1.2 million barrels for the same week. Outlook From the intra-day perspective, we expect crude oil to trade higher on the back of upbeat global market sentiments coupled with weakness in the DX. Additionally, shutdown in pipeline in Libya will also support an upside in the prices. However, sharp upside will be capped on account of rise in the crude output from Saudi Arabia and Iraq, Cyprus bailout issue along with expectations of rise in US crude oil inventories from API. In the Indian markets, appreciation in the Rupee will cap sharp gains in the prices on the MCX. Technical Outlook
Unit valid for March 19, 2013 Support Resistance

WTI (Spot) Brent (Spot) Nymex Crude (April 13) ICE Brent Crude (March13) MCX Crude (Mar 13)

Prev. day 0.2 -0.7 0.3

$/bbl

109.5

-0.3

-0.6

-6.7

-13.0

Rs/bbl

5056.0

-0.1

1.6

-2.5

-5.2
Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (Mar 13) Unit $/mmbtu Rs/ mmbtu Last 3.882 212.3 Prev. day 0.5 1.7

as on 18 March, 2013

WoW 6.71 7.06

MoM 22.31 22.79

YoY 67.04 81.61

Source: Reuters

Technical Chart NYMEX Crude Oil

SSource: Telequote

Technical Chart NYMEX Natural Gas

NYMEX Crude Oil MCX Crude March 13

$/bbl Rs/bbl

93.10/92.20 5020/4970

94.40/95.10 5090/5130

Source: Telequote

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Commodities Daily Report

Tuesday| March 19, 2013

International Commodities
Base Metals
The base metals pack traded on a negative note on the back of worries over Cyprus bailout as the European finance minister decided to levy special taxes on the bank deposits of Cyprus. Further, weak global market sentiments coupled with strength in DX added downside pressure on the prices. Additionally, rise in LME inventories, except Lead also acted as a negative factor for the base metal prices. On the MCX, depreciation in the Indian Rupee cushioned sharp fall in the prices. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (April13) LME Aluminum (3 month) MCX Aluminum (Mar13) LME Nickel $/tonne 16628.0 -1.8 -1.3 -7.3 -12.4 Rs /kg 103.2 -1.5 -1.6 -9.1 -7.9 $/tonne 1936.0 -1.5 -1.1 -8.8 -14.3 Rs/kg 412.7 -2.6 -3.0 -6.7 -4.5 $/tonne Last 7567.0 Prev. day -2.5 as on 18 March, 2013 WoW -2.6 MoM -3.6 YoY -11.3

Copper
Copper, the leader of the base metal pack decreased by 2.5 percent in yesterdays trade on the back of worries over Cyprus bailout. Further, weak global market sentiments coupled with strength in DX added downside pressure. Additionally, sharp rise in LME Copper inventories by 3.4 percent which stood at 543,925 tonnes kept the prices under pressure. The red metal touched an intra-day low of $7545.75/tonne and closed at $7567/tonne yesterdays trading session. On the domestic front, prices fell by 2.6 percent and closed at Rs. 412.7/kg on Monday after touching an intra-day low of Rs 412.2/kg. Depreciation in the Indian Rupee prevented sharp fall in the prices on the MCX. Outlook In the intra-day, we expect base metals prices to trade on the positive note on the back of expectation of positive economic data from US. Further, optimistic global market sentiments coupled with weakness in DX will support prices to gain strength. However, worries over Cyprus bailout, expectation of negative Industrial production data from Italy and decline in German ZEW economic sentiments may cap sharp gains in prices. Technical Outlook
Unit MCX Copper April13 MCX Zinc Mar 13 MCX Lead Mar 13 MCX Aluminum Mar13 MCX Nickel Mar 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for March 19, 2013 Support 410/407 101.8/100.7 116.5/115.8 102.7/102 888/880 Resistance 415/419 103.5/104.5 118/119.8 104/104.8 904/912

(3 month) MCX Nickel (Mar13) LME Lead (3 month) MCX Lead (Mar13) LME Zinc (3 month) MCX Zinc (Mar13)
Source: Reuters

Rs /kg

896.7

-2.0

-2.1

-7.6

-6.1

$/tonne

2176.8

-2.0

-1.2

-9.3

3.1

Rs /kg

117.3

-2.0

-1.6

-9.5

11.1

$/tonne

1920.8

-1.9

-2.2

-10.9

-7.4

Rs /kg

102.7

-2.1

-3.2

-11.6

-1.1

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 18th March 543,925 5,182,175 162,306 1,205,125 275,500 15th March 525,825 5,173,075 161,544 1,204,550 277,500 Actual Change 18,100 9,100 762 575 -2,000 (%) Change 3.4 0.2 0.5 0.0 -0.7
Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Tuesday| March 19, 2013

International Commodities
Important Events for Today
Indicator CPI y/y PPI Input m/m RPI y/y German ZEW Economic Sentiment ZEW Economic Sentiment BOE Inflation Letter Building Permits Housing Starts Country UK UK UK Europe Europe UK US US Time (IST) 3:00pm 3:00pm 3:00pm 3:30pm 3:30pm Tentative 6:00pm 6:00pm Actual Forecast 2.8% 1.6% 3.3% 47.9 43.7 0.93M 0.92M Previous 2.7% 1.3% 3.3% 48.2 42.4 0.90M 0.89M Impact High High Medium High Medium High High Medium

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