Commodities Daily Report

Monday| April 1, 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

Monday| April 1, 2013

International Commodities
Overview
US Revised UoM Consumer Sentiment rose to 78.6-mark in March. Japans Tankan Manufacturing Index declined to 8 marks in Q1 of 2013. Chinas Manufacturing PMI increased to 50.9-mark in March. French Consumer Spending declined by 0.2 percent in February. Asian markets are trading on the negative note on the back of unfavorable manufacturing data from Japan and Chinas manufacturing PMI increased at a slower note as compared to forecast leading to expectations of slowdown in the global economic growth. US Core Personal Consumption Expenditures (PCE) Price Index was at 0.1 percent in February as against a 0.2 percent a month ago. Personal Spending increased by 0.7 percent in February from earlier rise of 0.4 percent in prior month. Personal Income was at 1.1 percent in last month as compared to decline of 3.7 percent in January. Revised University of Michigan (UoM) Consumer Sentiment increased by 6.8 points to 78.6-mark in March with respect to 71.8-level in February. Revised UoM Inflation Expectations was at 3.2 percent in March when compared to 3.3 percent a month earlier. On a weekly basis, Indian Rupee appreciated marginally by 0.1 percent. The currency appreciated on account of selling of dollars from exporters and custodian banks. Additionally, upbeat global market sentiments also supported an upside in the currency. However, sharp upside in the currency was capped on the back of strength in the DX. The currency touched a weekly high of and closed at 54.28 against dollar on Thursday. For the month of March 2013, FII inflows totaled at Rs.9,124.30 crores ($1,675.48 million) as on 28th March 2013. Year to date basis, net capital inflows stood at Rs.55,622.40 crores ($10,310.10 million) till 28th March 2013. Japans Tankan Manufacturing Index declined to 8 marks in Q1 of 2013 as compared to -12-level in Q4 of 2012. Non-Manufacturing Index increased to 6-mark in first quarter of 2013 from 4-level in last quarter of 2012. Chinas Manufacturing Purchasing Managers' Index (PMI) increased by 0.8 points to 50.9-mark in the month of March with respect to 50.1-level in February. HSBC Final Manufacturing PMI declined marginally by 0.1 point to 51.6-level in March as against a rise of 51.7-mark in last month.

Market Highlights (% change)

Last INR/$ (Spot) 54.28 Prev day 0.3

as on 28 March, 2013 w-o-w 0.3 m-o-m 0.2 y-o-y -6.5

$/Euro (Spot)

1.2814

0.3

-0.6

-1.9

-3.8

Dollar Index NIFTY

83.18

-0.3

0.3

1.4

4.7

5682.6

0.7

0.4

-0.2

9.4

SENSEX

18835.8

0.7

0.2

-0.1

3.0

DJIA

14578.5

0.4

1.1

3.5

11.1

S&P

1569.2

0.4

1.5

3.6

11.6

Source: Reuters

French Consumer Spending declined by 0.2 percent in February as against a fall of 0.9 percent a month ago. Italian Prelim Consumer Price Index (CPI) was at 0.3 percent in March from 0.1 percent in February.

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Commodities Daily Report

Monday| April 1, 2013

International Commodities
Bullion Gold
Spot gold prices declined by 0.7 percent in the in the last week as the finance ministers from European union approved the bailout package to Cyprus, weakening the demand for safe haven. Further, reopening of banks in Cyprus reduced the concerns over deepening of Europes debt crisis also kept investors away from safe haven. Additionally, strength in Dollar index (DX) coupled with mixed global market sentiments also added downside pressure. However, US Federal Reserve decision to continue with its lose monetary policy coupled with unfavorable jobless claim data from US cushioned sharp downfall in prices. The yellow metal touched a weekly low of $1589.49.36/oz and closed at $1596.17/oz in last trading session of the week. In the Indian markets, prices fell by 0.8 percent taking cues from spot gold prices closed at Rs.29443/10 gms on Friday after touching an intra-day low of Rs. 29342/10 gms in the last week. Appreciation in the Indian rupee exerted downside pressure. Holdings in the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, remained unchanged at 1,221.26 tonnes as on th 28 March 2013. Market Highlights - Gold (% change)
Gold Gold (Spot) Unit $/oz Last 1596.2 Prev. day -0.5 as on 28 March, 2013 WoW -1.1 MoM 1.0 YoY -3.9

Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (June13) MCX Gold (June13)

Rs/10 gms $/oz

29575.0

0.3

-0.3

0.3

4.1

1598.3

-0.3

-1.0

0.6

-4.6

$/oz

1594.8

-0.7

-0.7

1.4

-3.8

Rs /10 gms

29443.0

-0.6

-1.3

-0.4

4.7

Source: Reuters

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (May13) MCX Silver (May13) Unit $/oz Rs/1 kg Last 28.3 54560.0 Prev day -1.1 -0.4

as on 28 March, 2013 WoW -2.8 -0.8 MoM -0.7 -2.0 YoY -11.4 -4.1

Silver
Taking cues from the fall in gold prices coupled with decline in base metals pack, Spot silver prices declined around 0.2 percent in the last week. Further, strength in DX also added downside pressure. The white metal prices touched a low of $28.09 /oz in the last week and closed at $28.32/oz in the last trade of the week. On the domestic front, prices fell by 1.0 percent taking cues from spot silver prices and closed at Rs. 53564/kg on Friday after touching a weekly low of Rs. 53250/kg. Appreciation in the Indian rupee exerted downside pressure. Holdings in the iShares Silver Trust, the world's largest silver-backed exchange-traded fund, increased around 0.14 percent at 10703.59 tonnes as on 28th March 2013 from previous 10688.56 tonnes on 22nd March 2013.

$/oz $/ oz

2864.0 2829.2

1.1 -1.0

-0.9 -3.0

-1.1 -0.6

-11.7 -11.1

Rs / kg

53564.0

-0.9

-2.7

0.6

-5.3

Source: Reuters

Technical Chart Spot Gold

Outlook
In the intraday, we expect precious metals to trade on a positive note on the back of worries over debt crisis in Cyprus and ongoing tension in Korean peninsula. However, strength in DX may cap sharp gains in prices. Technical Outlook
Unit Spot Gold MCX Gold June13 Spot Silver MCX Silver May13 $/oz Rs/10 gms $/oz Rs/kg valid for April 1, 2013
Source: Telequote

Support 1593/1587 29870/29760 27.90/27.70 52700/52100

Resistance 1604/1607 30070/30140 28.40/28.60 53500/53900

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Commodities Daily Report

Monday| April 1, 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices increased by 3.8 percent in the last week taking cues from rise in the US Gross Domestic Product (GDP) coupled with better revised consumer sentiments data from the country. However, sharp upside in the prices was capped on account of strength in the DX. Rise in crude oil inventories also prevented further gains in the prices. Crude oil prices touched a high of $97.35/bbl in the last week and closed at $97.23/bbl during the last trading session of the week. On the domestic bourses, prices gained by 4.2 percent and closed at Rs.5,305/bbl on Thursday after touching a weekly high of Rs.5320/bbl. Appreciation in the Indian Rupee restricted sharp upside in the prices on the MCX. Market Highlights - Crude Oil (% change)
Crude Oil WTI (Spot) Brent (Spot) Nymex Crude (May 13) ICE Brent Crude (May13) MCX Crude (April 13) Unit $/bbl $/bbl $/bbl Last 97.2 109.6 97.2 Prev. day 0.7 -0.1 0.7 WoW 5.2 1.9 5.2 as on 28 March, 2013 MoM 5.7 -3.3 7.2 YoY -7.7 -12.5 -7.8

$/bbl

110.0

0.3

2.4

-1.2

-11.4

Rs/bbl

5305.0

0.8

5.0

4.5

-1.7
Source: Reuters

Market Highlights - Natural Gas

Natural Gas (NG) Nymex NG MCX NG (April 13) Unit $/mmbtu Rs/ mmbtu Last 4.02 219.4

(% change)

as on 28 March, 2013

Natural Gas
On a weekly basis, Nymex natural gas prices increased by 2.3 percent on the back of more than expected decline in US natural gas inventories along with expectations of cooler winter weather conditions. However, strength in the DX prevented gains in the prices. Gas prices touched a weekly high of $4.121/mmbtu and closed at $4.02/mmbtu on Thursday. On the domestic front, prices gained by 2.3 percent and closed at Rs.219.40/mmbtu on Thursday after touching a high of Rs.224.40/mmbtu in the last week. Appreciation in the Indian Rupee restricted sharp upside in the prices on the MCX. Outlook From the intra-day perspective, we expect crude oil to trade on a positive note on the back of rise in Chinas manufacturing data which led to expectations of rise in demand for the fuel. However, sharp upside in the prices would be capped on account of rise in risk aversion in the global market sentiments coupled with strength in the DX. Technical Outlook
Unit NYMEX Crude Oil MCX Crude April 13 $/bbl Rs/bbl valid for April 1, 2013 Support 95.80/94.90 5350/5300 Resistance 97.60/98.50 5450/5500

Prev. day -1.5 -1.5

WoW 2.29 2.28

MoM 15.09 14.81

YoY 77.33 84.21

Source: Reuters

Technical Chart NYMEX Crude Oil

Source: Telequote

Technical Chart NYMEX Natural Gas

Source: Telequote

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Commodities Daily Report

Monday| April 1, 2013

International Commodities
Base Metals
The base metals pack traded lower in the last week as the investors were worried that the Cyprus bank restructuring may be used as a model for other European nations which may endanger bondholders and depositors. Further, unfavorable economic data from US coupled with strength in DX also added downside pressure. Additionally, United Kingdom (UK) GDP contracted at 0.3 percent in Q4 of 2012 kept prices under pressure. However, finance ministers from EU approved bailout package to Cyprus and reopening of Cyprus banks reduced the worries over deepening of Europes debt crisis prevented sharp decline in prices. On MCX appreciation in the Indian rupee exerted downside pressure on the prices. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (April13) LME Aluminum (3 month) MCX Aluminum (April13) LME Nickel (3 month) MCX Nickel (April13) LME Lead (3 month) MCX Lead (April13) LME Zinc (3 month) MCX Zinc (April13)
Source: Reuters

as on 28 March, 2013 WoW -1.0 MoM -4.0 YoY -9.9

Last 7533.3

Prev. day -1.4

$/tonne

Rs/kg

413.0

-1.1

-0.8

-1.2

-4.1

$/tonne

1903.0

-1.0

-1.2

-5.2

-12.3

Rs /kg

102.2

-0.8

-1.1

-3.1

-6.2

$/tonne

16688.0

-1.1

-1.0

0.5

-5.4

Copper
Copper, the leader of the base metal pack declined by 1.8 percent in the last week on the back of negative economic data from US coupled with strength in the DX. Further, United Kingdom (UK) GDP contracted at 0.3 percent in Q4 kept prices under pressure. However, approval of bailout package to Cyprus by EU finance ministers and reopening of banks in Cyprus prevented sharp fall in prices. The red metal touched a weekly low of $7,522/tonne and closed at $7,533.25/tonne in the last trading session of the week. On the domestic front, prices declined by 1.5 percent and closed at Rs. 413/kg on Friday after touching a low of Rs 412.6/kg in the last week. Appreciation in the Indian rupee added downside pressure. Copper Inventories LME copper inventories gained around 1.3 percent in the last week and stood at 569,775 tonnes as on 28th March, 2013 as against 562,475 tonnes as on 22nd March, 2013. Copper inventories in the warehouse monitored by the Shanghai rose by 3.5 percent and stood at 247,591 tonnes for the week ending on 29th March, 2013. Outlook In the intra-day, we expect base metals prices to trade on the negative note on the back of weak global market sentiments coupled with strength in DX. Further, unfavourable manufacturing data from Japan and decline in Chinas HSBC manufacturing PMI as compared to expectation will add downside pressure. Technical Outlook valid for April 1, 2013
Unit MCX Copper April13 MCX Zinc April 13 MCX Lead April 13 MCX Aluminum April13 MCX Nickel April 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg Support 406/402 101.90/100.90 113.80/112.80 102.80/101.50 904/897 Resistance 413/416 104.0/105.0 115.80/116.80 104.50/105.50 920/927

Rs /kg

905.2

-1.2

-1.4

1.4

0.9

$/tonne

2107.3

-1.2

-3.0

-7.5

6.7

Rs /kg

113.9

-0.8

-3.1

-7.4

12.7

$/tonne

1896.0

-1.1

-2.2

-8.3

-5.4

Rs /kg

101.5

-1.1

-2.7

-8.7

-0.6

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 28 March 569,775 5,237,400 165,420 1,175,525 262,725
th

27 March 567,900 5,230,650 164,652 1,182,700 264,475

th

Actual Change 1,875 6,750 768 -7,175 -1,750

(%) Change 0.3 0.1 0.5 -0.6 -0.7

Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Monday| April 1, 2013

International Commodities
Important Events for Today
Indicator Tankan Manufacturing Index Tankan Non-Manufacturing Index Manufacturing PMI HSBC Final Manufacturing PMI ISM Manufacturing PMI Country Japan Japan China China US Time (IST) 5:20am 5:20am 6:30am 7:15am 7:30pm Actual -8 6 50.9 51.6 Forecast -7 8 51.6 51.7 54.2 Previous -12 4 50.1 51.7 54.2 Impact Medium Medium High Medium High

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