Commodities Daily Report

Wednesday| July 10, 10 2013

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Research Team
Reena Rohit Chief Manager Non-Agri Currencies and Commodities Reena.rohit@angelbroking.com (022) 2921 2000 Extn :6134 Anish Vyas Research Analyst anish.vyas@angelbroking.com (022) 2921 2000 Extn :6104

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Commodities Daily Report

Wednesday| July 10, 10 2013

International Commodities
Overview
IMF cuts the global growth forecast to 3.1 percent for current year. OMCs to buy dollars from SBI as per RBI circular in yesterdays trade. UKs Manufacturing Production declined 0.8 percent in month of May. Japans Tertiary Industry Activity increased by 1.2 percent in May May.

Market Highlights (% change)

Last INR/$ (Spot) 60.092 Prev day 1.0

as on 9 July, 2013 w-o-w -0.9 m-o-m -5.3 y-o-y -7.8

Asian markets are trading higher today on the back of favorable economic data from Japan along with surplus in Chinas trade balance. The International Monetary Fund (IMF) has cut the global growth forecast to 3.1 percent for 2013 from earlier estimates of 3.3 percent in April. The agency has also lowered expectations for the next year to 3.8 percent from 4 percent in the month of April. Euro ro Zone is projected to contract by 0.6 percent in 2013 and expands around 1 percent in next year. IMF also predicted that US economy will grow at slow pace of 1.7 percent for the current year. The Reserve Bank of India (RBI) has ordered state-owned oil companies (OMCs) to purchase their dollar requirements from State Bank of India (SBI) and curb the volatility in the currency. Oil refiners are the biggest buyers of US dollars and account for $8-8.5 8.5 billion of monthly requirements. The state owned refiners have agreed to implement the RBIs move from immediate effect. The companies are even ready to accept RBI selling dollars directly through a single window. The US Dollar Index (DX) increased around 0.4 percent in the yesterdays trade on the back of expectations pectations that Fed will go ahead with its reduction plan in bond buying as early as from September. However, recovery in market sentiments capped sharp gains in the currency. The DX touched an intra-day day low of 84.97 and closed at 84.78 on Tuesday. The Indian Rupee appreciated around 1 percent in yesterdays trading session after the currency touched all time low in previous session. The currency appreciated on account of steps taken by Reserve Bank of India (RBI) on banning banks from proprietary trading in domestic currency futures and options. Additionally, Securities Exchange Board of India (SEBI) doubled the margin requirement on domestic dollar dollar-rupee trade which supported an upside in the currency. Further, recovery in global and domestic markets acted as a positive factor for prices. The currency touched an intra-day day high of 59.71 and closed at 60.09 on Tuesday. For the month of July 2013, FII inflows totaled at Rs.782.40 crores th ($134.05 million) as on 9 July 2013. Year to date basis, net capital th inflows stood at Rs.72,960.60 crores ($13,634.90 million) till 9 July 2013. UKs Manufacturing Production declined 0.8 percent in May as compared to fall of 0.2 percent a month earlier. Trade Balance was at a deficit of 8.5 billion Pounds in May with respect to deficit of 8.4 billion Pounds in prior month. www.angelcommodities.com
$/Euro (Spot) 1.278 -0.7 0.7 -1.5 -3.3 4.3

Dollar Index NIFTY

84.78

0.4

1.2

4.5

6.7

5859.0

0.8

0.0

-0.4

10.2

SENSEX

19439.5

0.6

-0.1

0.1

6.3

DJIA

15300.3

0.5

2.2

1.2

20.1

S&P

1652.3

0.7

2.4

0.5

22.0

Source: Reuters

The Euro depreciated around 0.7 percent in the yesterdays trade on the back of strength in the DX. Further, unfavorable economic data from the region exerted downside pressure on the currency. However, sharp downside in the currency was cushioned cushione on account of recovery in global markets. The Euro touched an intra-day day low of 1.2754 and closed at 1.278 against the dollar on Tuesday. French Gov Budget Balance was at a deficit of 72.6 billion Euros in May as against a deficit of 66.8 billion Euros a month ago. Japans Tertiary Industry Activity increased by 1.2 percent in May as against a decline of 0.5 percent a month ago. Corporate Goods Price Index (CGPI) gained by 1.2 percent in June from earlier rise of 0.5 percent in May.

Commodities Daily Report

Wednesday| July 10, 10 2013

International Commodities
Bullion Gold
Spot gold prices gained around 1 percent in the yesterdays trading session on the back of recovery in the market sentiments sentiments. However, sharp upside in prices was capped on account of strength in the DX coupled with decline in the SPDR gold holdings which is at lowest level since February 2009. The yellow metal touched an intra intra-day high of $1260.01/oz and closed at $1248.80/oz in yesterdays trade trade. In the Indian markets, prices ended on a negative note, declining around 0.4 percent on account of appreciation ion in the Indian Rupee. The commodity closed at Rs.26010/10 /10 gms after touching a low of Rs.25976/10 gms on Tuesday. Market Highlights - Gold (% change)
Gold Gold (Spot) Unit $/oz Last 1248.8 Prev. day 1.0 as on 9 July, 2013 WoW 0.6 MoM -9.8 YoY -20.2

Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (August13) MCX Gold (August13)

Rs/10 gms $/oz

26070.0

0.3

0.2

-6.4

-11.5

1255.5

1.6

0.2

-9.4

-21.3

$/oz

1245.9

0.9

0.2

-10.5

-21.6

Rs /10 gms

26010.0

-0.4

0.4

-5.5

-11.6

Silver
Taking cues from rise in gold prices, Spot silver prices rose around 1 percent in the yesterdays trade. However, strength in the DX coupled with downside in the base metals complex capped sharp gains in prices. The white metal touched an intra-day high of $19.50/oz and closed at $19.20/oz in the yesterdays trading session session. On the domestic front, prices dropped 0.5 percent as a result of appreciation in the Indian Rupee and closed at Rs. Rs.40,168/kg after touching a low of Rs.40,118/kg on Tuesday. Market Highlights - Silver (% change)
Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (Sept13) MCX Silver (Sept13) Unit $/oz Rs/1 kg Last 19.2 40900.0 Prev day 1.0 -0.9

Source: Reuters

as on 9 July, 2013 WoW -0.5 -1.4 MoM -11.1 -10.1 YoY -28.1 -23.1

$/oz $/ oz

1910.0 19.1

-0.3 0.5

-2.7 -0.9

-15.5 -12.3

-30.7 -28.8

Outlook
Precious metals prices in todays trade are expected to trade on a lower note taking cues from strength in the DX. . Further, decline in SPDR gold holdings will also add downside pressure on prices prices. However, sharp downside will be cushioned on account of recovery in the market sentiments. In the Indian markets, ap appreciation in the Rupee will exert downside pressure in prices on the MCX. Technical Outlook
Unit Spot Gold MCX Gold Aug13 Spot Silver MCX Silver Sept13 $/oz Rs/10 gms $/oz Rs/kg valid for July 10 10, 2013 Support 1241/1235 25900/25780 18.90/18.70 39800/39400 Resistance 1250/1260 26100/26300 19.20/19.40 40400/40900

Rs / kg

40168.0

-0.5

0.7

-6.6

-23.7

Source: Reuters

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Wednesday| July 10, 10 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices gained around 0.4 percent in yesterdays trade taking cues from sharp decline in API crude oil inventories inventories. Further, unrest and political turmoil in Egypt raised the supply concerns from the Middle East acted as a positive factor for oil prices. However, sharp upside in prices was capped on the back of strength in the DX. Crude oil prices touched an intra-day high of $104 $104.76/bbl and closed at $103.50/bbl in yesterdays trading session. On the domestic bourses, prices fell 0.7 percent in yesterdays trade on account of appreciation in the Indian Rupee. . The commodity closed at Rs.6,209/bbl after touching a low of Rs.6,156/bbl on Tues Tuesday. API Inventories Data As per the American Petroleum Institute (API) report last night, US crude oil inventories declined more than expected by 9.0 million barrels to 373.67 million barrels for the week ending on 5th July 2013. Gasoline inventories fell by 3.5 million barrels to 219.62 million barrels and whereas distillate inventories gained by 2.8 million barrels to 122.38 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 expected to fall by 3.1 million barrels for the week ending on 5th July 2013. Gasoline stocks are expected to gain by 0.6 million barrels whereas distillate inventories are expected to rise by 0.7 million barre barrels for the same period. Outlook
Source: Telequote

Market Highlights - Crude Oil (% change)

Crude Oil Brent (Spot) Nymex Crude (Aug 13) ICE Brent Crude (Aug13) MCX Crude (July 13) Unit $/bbl $/bbl Last 108.5 103.5 Prev. day 0.1 0.4 WoW 4.1 5.7

as on 9 July, 2013 MoM 4.0 8.5 YoY 8.9 20.4

$/bbl

107.8

0.4

3.7

3.1

10.0

Rs/bbl

6209.0

-0.7

4.7

12.6

30.6

Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (July 13)

as on 9 July, 2013

Unit $/mmbtu Rs/ mmbtu

Last 3.659 219.2

Prev. day -2.0 -3.9

WoW 0.22 0.27

MoM -4.29 -0.36

YoY 31.15 39.00

Source: Reuters

Technical Chart NYMEX Crude Oil

From the intra-day day perspective, we expect crude oil prices to trade higher on the back of unrest and political turmoil in Egypt. Further, more than expected decline in API crude oil inventories in yesterdays trade will act as a positive factor for prices. Additionally, expectations of fall in US crude oil inventories will support an upside in prices. However, cut in the global growth forecast by IMF for 2013 and 2014 will prevent sharp upside in prices. In the Indian markets, appreciation preciation in the Rupee will cap sharp gains in prices on the MCX. Technical Outlook
Unit NYMEX Crude Oil MCX Crude July13 $/bbl Rs/bbl valid for July 10, 2013 Support 103.35/102.50 6150/6100 Resistance 105.0/106.0

Technical Chart NYMEX Natural Gas

Source: Telequote

6250/6310

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Commodities Daily Report

Wednesday| July 10, 10 2013

International Commodities
Base Metals
Market Highlights - Base Metals (% change) The base metals pack traded on a negative note in the yesterdays trade on the back of strength in the DX. . Additionally, decline in manufacturing and industrial production data from UK exerted downside pressure on the prices. However, sharp downside in prices was cushioned as a result of decline in LME inventories except Aluminium along with recovery in the market sentiments. In the Indian markets, appreciation in the Rupee added downside pressure in prices on the MCX.
Unit LME Copper (3 month) MCX Copper (Aug13) LME Aluminum (3 month) MCX Aluminum (July13) LME Nickel (3 month) MCX Nickel (July13) LME Lead (3 month) MCX Lead (July13) Rs /kg 122.4 -2.6 -1.5 -1.1 17.5 $/tonne 2041.0 -1.6 -1.9 -5.6 9.4 Rs /kg 805.6 -1.4 -3.8 -6.6 -10.6 $/tonne 13425.0 -0.1 -4.1 -10.4 -16.5 Rs /kg 106.2 -1.6 -1.4 -2.9 0.5 $/tonne 1793.0 -0.6 -1.7 -7.2 -6.1 Rs/kg 408.8 -2.2 -2.0 -1.4 -2.7 $/tonne Last 6756.0 Prev. day -1.1 as on 9 July, 2013 WoW -2.5 MoM -13.9 YoY -9.9

Copper
Copper prices traded on a negative note and declined more than 1 percent in yesterdays trading session on the back of strength in the DX. Further, unfavourable manufacturing and industrial production data from UK acted as a negative factor. However, recovery in the global markets cushioned sharp fall in prices. Additionally, , decline in LME copper inventories around 1 percent which stood at 650,125 tonnes prevented sharp downside in prices. The red metal touched an intra-day low of $6 $6671.75/tonne and closed at $6756/tonne in yesterdays trade. On the domestic front, prices fell 2.2 percent as a result of appreciation in the Indian Rupee and closed at Rs. 408.8 408.80/kg after touching a low of Rs.406.10/kg on Tuesday. Outlook In todays session, we expect base metals prices to trade on a lower note on the back of strength in the DX. Further, cut in the global growth forecast by IMF for current year and next year will also act as a negative factor for prices. Additionally, expectations of decline in industrial production from Euro Zone will exert t downside pressure on prices. In the Indian markets, appreciation preciation in the Rupee will add downside pressure in prices on the MCX. Technical Outlook
Unit MCX Copper Aug13 MCX Zinc July 13 MCX Lead July 13 MCX Aluminum July13 MCX Nickel July 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for July 10, 201 2013 Support 404/401 110.0/109.0 121.50/120.50 105.30/104.50 798/790 Resistance 412/416 111.80/112.80 123.20/124.20 107.0/108.0 812/818

LME Zinc (3 month) MCX Zinc (July13)

$/tonne

1869.0

-0.3

-1.0

-1.4

2.0

Rs /kg

111.0

-1.6

-0.8

3.2

8.2

Source: Reuters

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 9th July 650,125 5,433,575 193,416 1,025,050 195,975 8th July 656,600 5,419,875 193,578 1,030,325 196,175 Actual Change -6,475 13,700 -162 -5,275 -200 (%) Change -1.0 0.3 -0.1 -0.5 -0.1
Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Wednesday| July 10, 10 2013

International Commodities
Important Events for Today
Indicator Country Time (IST) Actual Forecast Previous Impact

Tertiary Industry Activity m/m Trade Balance French Industrial Production m/m Crude Oil Inventories 10-y Bond Auction FOMC Meeting Minutes

Japan China Euro US US US

5:20am 7:30am 12:15pm 8:00pm 10:30pm 11:30pm

1.2% 27.1B -

0.9% 27.8B -0.5% -3.1M -

0.0% 20.4B 2.2% -10.3M 10.3M 2.21/2.5 -

Medium High Medium Medium Medium High

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