Commodities Daily Report

Wednesday| May 15, 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

Wednesday| May 15, 2013

Overview

International Commodities
India's Wholesale Price Index (WPI) declined to 4.89 percent in April. US Import Prices declined by 0.5 percent in the last month. German ZEW Economic Sentiment increased to 36.4-mark in May. Japans Tertiary Industry Activity declined by 1.3 percent in March .

Market Highlights (% change)

Last INR/$ (Spot) 54.79 Prev day 0.1

as on 14 May, 2013 w-o-w -1.4 m-o-m -1.5 y-o-y -1.6

Asian markets are trading higher today on the back of favorable economic data from major global economies which led to rise in risk appetite in the global market sentiments. US National Federation of Independent Business (NFIB) Small Business Index increased by 2.6 points to 92.1-mark in April as against a rise of 89.5-level in March. Import Prices declined by 0.5 percent in April from earlier fall of 0.2 percent a month ago. India's Wholesale Price Index (WPI) declined to 4.89 percent in April which at lowest level since 2009 from earlier rise of 5.96 percent in March. Fuel inflation fell to 6.1 percent in last month as against a rise of 8.7 percent in March. Fuel prices rose at slow pace of 8.8 percent in April as compared to rise of 10.2 percent in March. Non-food manufacturing inflation slowed to 2.8 percent in April with respect to increase of 3.5 percent a month ago. The US Dollar Index (DX) increased by 0.4 percent in the yesterdays trading session on the back of rise in risk aversion in the global market sentiments in the early part of the trade which led to increase in demand for the low yielding currency. However, sharp upside in the currency was capped on account of favorable import prices data from the US. Further, US equities traded on a positive note which also prevented sharp upside in the DX. The currency touched an intra-day high of 83.835 and closed at 83.71 on Tuesday. The Indian Rupee appreciated by 0.1 percent in yesterdays trading session. The currency appreciated on account of decline in WPI of the country which is at lowest level since 2009. Additionally, upbeat global market sentiments also supported an upside in the currency. However, sharp upside in the Indian Rupee was capped as a result of strength in the DX. The currency touched an intra-day high of 54.535 and closed at 54.79 against dollar on Tuesday. For the month of May 2013, FII inflows totaled at Rs.8,594.80 crores th ($1,587.87 million) as on 14 May 2013. Year to date basis, net capital th inflows stood at Rs.69,631.20 crores ($12,898.20 million) till 14 May 2013. UKs Royal Institution of Chartered Surveyors (RICS) House Price Balance increased by 1 percent in April as against a decline of 2 percent in March. The Conference Board (CB) Leading Index was at 0.4 percent in the month of March.

$/Euro (Spot)

1.2918

-0.4

-1.2

-2.0

0.7

Dollar Index NIFTY

83.71

0.4

1.7

2.3

5.4

5995.4

0.2

-0.8

5.4

21.6

SENSEX

19722.3

0.2

-0.8

5.2

7.8

DJIA

15215.3

0.8

1.1

4.1

19.8

S&P

1650.3

1.0

1.5

3.9

23.3

Source: Reuters

The Euro depreciated by 0.4 percent in yesterdays trade on the back of strength in DX coupled with weak economic data from Germany. However, sharp downside in the currency was cushioned on the back of rise in industrial production data from euro zone along with optimistic global market sentiments. Further, Fitch credit rating agency upgraded Greece sovereign rating to B-minus from CCC, with stable outlook which prevented harp depreciation in the euro. German ZEW Economic Sentiment increased marginally by 0.1 point to 36.4-mark in May as against a rise of 36.3-level in April. Industrial Production grew by 1 percent in March from rise of 0.3 percent a month ago. European ZEW Economic Sentiment increased by 2.7points to 27.6-mark in May as compared to rise of 24.9-level in April. The Euro touched an intra-day low of 1.2914 and closed at 1.2918 against dollar on Tuesday. Japans Prelim Machine Tool Orders fell by 24.1 percent in April as against a drop of 21.5 percent in the month of March. Tertiary Industry Activity declined by 1.3 percent in March from earlier rise of 1.2 percent a month ago.

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Commodities Daily Report

Wednesday| May 15, 2013

International Commodities
Bullion Gold
Spot gold prices declined by 0.3 percent in the yesterdays trading session on the back of strength in DX coupled with weak economic data from Germany. Further, rise in stock market led to the decline in demand for safe haven. Additionally, SPDR gold trust holding continued to decline, which acted as a negative factor for the prices. The yellow metal touched an intra-day low of $1421.65/oz and closed at $1425.4/oz in yesterdays trading session. In the Indian markets, prices ended on negative note in the yesterday trading session taking cues from spot gold prices and closed at Rs.26707/10 gms after touching an intra-day low of Rs. 26652/10 gms on Tuesday. Appreciation in the Indian Rupee kept prices under pressure. Market Highlights - Gold (% change)
Gold Gold (Spot) Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (June13) MCX Gold (June13) Unit $/oz Rs/10 gms $/oz Last 1425.4 26679.0 Prev. day -0.3 -0.1 as on 14 May, 2013 WoW -1.8 -1.4 MoM 4.2 3.8 YoY -8.4 -5.5

1433.8

0.2

-0.7

3.9

-8.0

$/oz

1424.7

-0.7

-3.3

3.1

-10.0

Rs /10 gms

26707.0

-0.5

-0.1

3.7

-5.4

Source: Reuters

Silver
Taking cues from decline in spot gold prices coupled with downside in the base metal packs, Spot silver prices fell by 1.0 percent in the yesterdays trading session. Further, unsatisfactory data from Germany added downside pressure on the prices. However, rise in risk appetite in the global market sentiments cushioned sharp downside in the prices. The white metal prices touched an intra-day low of $23.11 /oz and closed at $23.36/oz in yesterdays trade. On the domestic front, prices decreased by 1.3 percent taking cues from spot silver prices and closed at Rs. 44516/kg after touching an intra-day low of Rs. 44152/kg on Tuesday.

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (May13) MCX Silver (May13) Unit $/oz Rs/1 kg Last 23.4 45320.0 Prev day -1.0 -1.0

as on 14 May, 2013 WoW -2.2 -0.4 MoM 0.0 -2.5 YoY -16.9 -14.5

$/oz $/ oz

2344.0 2335.5

-0.9 -1.3

-1.3 -1.8

-0.1 0.2

-17.3 -17.5

Rs / kg

44516.0

-1.3

-0.8

0.7

-17.0

Source: Reuters

Technical Chart Spot Gold

Outlook
In the intraday, we expect precious metals to trade on a negative note on the back of rise in stock markets may led to decline in demand for safe haven. Further, strength in DX coupled with expectation of weak economic data from euro zone may add downside pressure on the prices. Additionally, SPDR gold trust holding is near to 4 years low, which may keep prices under pressure. In the Indian markets appreciation in the Indian rupee may add downside pressure on the prices. Technical Outlook
Unit Spot Gold MCX Gold June13 Spot Silver MCX Silver May13 $/oz Rs/10 gms $/oz Rs/kg valid for May 15, 2013 Support 1422/1415 26600/26500 23.10/22.90 44100/43700 Resistance 1436/1444 26860/27000 23.60/23.90 45000/45500
Source: Telequote

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Commodities Daily Report

Wednesday| May 15, 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices declined around 1 percent yesterday taking cues from rise in US crude oil inventories from API which is at highest level in last 82 years. Further, strength in the DX also exerted downside pressure on the crude oil prices. However, sharp downside in the prices was cushioned as a result of rise in risk appetite in the global market sentiments. Crude oil prices touched an intra-day low of $93.85/bbl and closed at $94.20/bbl in yesterdays trading session. On the domestic bourses, prices declined by 0.9 percent on account of appreciation in the Indian Rupee and closed at Rs.5,190/bbl after touching an intra-day low of Rs.5175/bbl on Tuesday. API Inventories Data As per the American Petroleum Institute (API) report last night, US crude oil inventories gained by 541,000 barrels to 390.21 million barrels th for the week ending on 10 May 2013. Crude oil inventories are at the highest level since 1931. Gasoline inventories fell by 480,000 barrels to 216.48 million barrels and whereas distillate inventories gained by 1.9 million barrels to 117.92 million barrels for the same week. EIA Inventories Forecast The US Energy Department (EIA) is scheduled to release its weekly inventories report today at 8:00pm IST and US crude oil inventories is th expected to rise by 0.3 million barrels for the week ending on 10 May 2013. Gasoline stocks are expected to fall by 0.8 million barrels whereas distillate inventories are expected to gain by 0.7 million barrels for the same period. Outlook From the intra-day perspective, we expect crude oil prices to trade lower today on the back of expectations of rise in US crude oil inventories coupled with strength in the DX. Further, increase in crude oil inventories from API which is at the highest level in last 82 years will also exert downside pressure on the oil prices. However, sharp downside in the prices will be cushioned as a result of rise in risk appetite in the global market sentiments. In the Indian markets, appreciation in the Rupee will also add downside pressure on the crude oil prices. Technical Outlook
Unit NYMEX Crude Oil MCX Crude May13 $/bbl Rs/bbl valid for May 15, 2013 Support 94.00/93.20 5170/5130 Resistance 95.10/96.00 5230/5280
Source: Telequote Source: Telequote

Market Highlights - Crude Oil (% change)

Crude Oil WTI (Spot) Brent (Spot) Nymex Crude (May 13) ICE Brent Crude (May13) MCX Crude (May 13) Unit $/bbl $/bbl $/bbl Last 94.0 102.9 94.2 Prev. day -0.8 0.9 -1.0 WoW -1.4 -3.2 -1.5

as on 14 May, 2013 MoM 5.9 3.9 8.7 YoY -0.8 -7.7 -0.6

$/bbl

102.6

-0.2

-1.7

2.7

-8.0

Rs/bbl

5190.0

-0.9

0.4

8.3

1.5
Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (May 13) Unit $/mmbtu Rs/ mmbtu Last 4.02 219.2 Prev. day 2.1 1.9

as on 14 May, 2013

WoW 2.58 2.96

MoM -5.63 -5.23

YoY 66.18 66.57

Source: Reuters

Technical Chart NYMEX Crude Oil

Technical Chart NYMEX Natural Gas

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Commodities Daily Report

Wednesday| May 15, 2013

International Commodities
Base Metals
Market Highlights - Base Metals (% change) The base metals pack traded on a negative note on the back of strength in Dollar index coupled with rise in LME inventories except Zinc. Further, unfavourable economic data from Germany added downside pressure on the prices. Additionally, worries over Chinas economic growth kept prices under pressure. However, optimistic global market sentiments cushioned sharp fall in the prices. In the Indian market appreciation in the Indian rupee added downside pressure on the prices.
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) Rs /kg 108.2 -1.7 -1.3 -3.0 -1.3 $/tonne 1977.0 -1.8 -2.8 -4.9 -2.8 Rs /kg 827.3 -1.7 0.7 -3.0 -9.8 $/tonne 15124.0 -1.4 -0.5 -4.0 -10.8 Rs /kg 101.1 -0.6 0.0 -1.8 -6.6 $/tonne 1855.5 -0.4 -1.5 -3.5 -8.4 Rs/kg 399.8 -2.2 0.9 1.3 -5.9 $/tonne Last 7244.8 Prev. day -2.0 as on 14 May, 2013 WoW -0.4 MoM -7.7 YoY -7.4

Copper
Copper, the leader of the base metal pack decreased by 2.0 percent on the back of strength in DX coupled with unsatisfactory economic data from Germany. Further, rise in LME inventories by 2.0 percent to 618,700 tonnes exerted downside pressure on the prices. However, rise in risk appetite in the global market sentiments cushioned sharp downside in the prices. The red metal touched an intra-day low of $7214/tonne and closed at $7244.75/tonne yesterdays trading session. On the domestic front, prices ended on negative note on the back of appreciation in the Indian Rupee and closed at Rs. 399.8/kg on Tuesday after touching an intra-day low of Rs 398.2/kg. Outlook

LME Zinc (3 month) MCX Zinc (April13)

$/tonne

1844.0

-1.2

-1.7

-3.2

-3.8

Rs /kg

100.2

-1.2

-0.4

-1.4

-3.2

Source: Reuters

LME Inventories
Unit Copper tonnes tonnes tonnes tonnes tonnes 14th May 618,700 5,230,300 178,434 1,033,375 245,650 13th May 606,700 5,154,175 177,840 1,038,200 243,775 Actual Change 12,000 76,125 594 -4,825 1,875 (%) Change 2.0 1.5 0.3 -0.5 0.8
Source: Reuters

In the intra-day, we expect base metals prices to trade on the negative note on the back of strength in DX coupled with worries over chinas economic growth. Further, expectation of weak economic data from euro zone and US may add downside pressure on the prices. However, optimistic global market sentiment may cushion sharp downside in the prices. In the Indian markets, appreciation in the Indian Rupee may add downside pressure on the prices. Technical Outlook
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 valid for May 15, 2013 Support 396/392 99.50/98.50 107.4/106.5 100.5/99.5 820/811 Resistance 403/407 101/101.80 109/109.8 102/102.8 835/845

Aluminum Nickel Zinc Lead

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Wednesday| May 15, 2013

International Commodities
Important Events for Today
Indicator Tertiary Industry Activity m/m French Prelim GDP q/q German Prelim GDP q/q Italian Prelim GDP q/q Claimant Count Change Unemployment Rate Flash GDP q/q BOE Gov King Speaks BOE Inflation Report PPI m/m Core PPI m/m Empire State Manufacturing Index TIC Long-Term Purchases Capacity Utilization Rate Industrial Production m/m Crude Oil Inventories Country Japan Europe Europe Europe UK UK Europe UK UK US US US US US US US Time (IST) 5:20am 11:00am 11:30am 1:30pm 2:00pm 2:00pm 2:30pm 3:00pm 3:00pm 6:00pm 6:00pm 6:00pm 6:30pm 6:45pm 6:45pm 8:00pm Actual -1.3% Forecast -0.6% -0.1% 0.3% -0.4% -3.1K 7.9% -0.1% -0.6% 0.1% 3.6 33.8B 78.4% -0.1% 0.5M Previous 1.1% -0.3% -0.6% -0.9% -7.0K 7.9% -0.6% -0.6% 0.2% 3.1 -17.8B 78.5% 0.4% 0.2M Impact Medium Medium Medium Medium High Medium Medium High High High Medium Medium Medium Medium Medium Medium

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