Commodities Daily Report

Thursday| August 8, 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

Thursday| August 8, 2013

International Commodities
Overview
Chinas Trade Balance was at a surplus of $17.8 billion in July. German Industrial Production increased by 2.4 percent in June June. Japans Current Account was at a surplus of 0.65 trillion Yen in June. French Trade Balance was at deficit of 4.4 billion Euros in prior month.

Market Highlights (% change)

Last INR/$ (Spot) 61.2 Prev day -0.7 0.7

as on 7 August, 2013 w-o-w -0.6 m-o-m -0.9 y-o-y -9.7

Asian markets are trading higher today ahead of the Bank of Japan (BOJ) policy meeting and Chinese Trade Balance data. It is expected that BOJ will keep its policy unchanged in todays meeting and more stimulus can be estimated over next ten months from Governor Haruhiko Kuroda as their main target is to achieve inflation of 2 percent. Chinas Trade Balance was at a surplus of $17.8 billion in July from earlier surplus of $27.1 billion in June. The US Dollar Index (DX) declined around 0.4 percent in yesterdays trade on the back of favorable economic data from previous sessions showing signs of economic growth. wth. However, positive economic data has led to expectations that the Fed will pullback its stimulus measures coupled with rise in risk aversion in global market sentiments cushioned sharp fall in the currency. The DX touched an intra-day low of 81.27 and closed at 81.32 on Wednesday. The Indian Rupee depreciated around 0.7 percent in yesterdays trading session. The currency depreciated on the back of weak global and domestic markets coupled with strength in the DX in early part of the trade. Further, heavy avy dollar demand from importers also exerted downside pressure on the currency. However, sharp downside in the currency was cushioned as a result of expectations that Reserve Bank of India (RBI) will ease its norms for External Commercial Borrowing (ECB). ). Additionally, selling of dollars from central banks along with expectations that RBI will come up with some measures prevented sharp fall in the currency. The Rupee touched an intra-day day low of 61.461 and closed at 61.20 on Wednesday. f August 2013, FII inflows totaled at Rs.1406 crores For the month of th ($230.44 million) as on 7 August 2013. Year to date basis, net capital th inflows stood at Rs.67498.40 crores ($12,716.20 million) till 7 August 2013. Japans Current Account was at a surplus of 0.65 trillion Yen in June as against a earlier surplus of 0.62 trillion Yen a month ago. Bank Lending was at 2 percent in July from 1.9 percent in June.

$/Euro (Spot)

1.3336

0.2

0.3

3.6

7.9

Dollar Index NIFTY

81.32

-0.4 0.4

-0.3

-3.5

2.3

5519.1

-0.4 0.4

-3.9

-5.0

4.5

SENSEX

18664.9

-0.4 0.4

-3.5

-3.4

2.1

DJIA

15470.7

-0.3 0.3

-0.2

0.1

17.5

S&P

1690.9

-0.4 0.4

3.6

3.6

20.7

Source: Reuters

The Euro appreciated around 0.2 percent in the yesterdays trading session on the back of weakness in the DX coupled with favorable economic data from the region. However, sharp upside in the currency was capped as result of weak global markets sentiments. The Euro o touched an intra-day intra high of 1.3345 and closed at 1.3336 against the dollar on Wednesday. Wednesday French Trade Balance was at a deficit of 4.4 billion Euros in June as against a previous deficit of 5.7 billion Euros a month ago. German Industrial Production increased inc by 2.4 percent in June from earlier decline of 0.8 percent in earlier month.

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Commodities Daily Report

Thursday| August 8, 2013

International Commodities
Bullion Gold
Spot gold prices declined around 0.5 percent in the yesterdays trade on the back of weakness in the DX. However, sharp upside in prices was capped as a result of fall in SPDR gold holdings by 0.5 percent in yesterdays trade and stood at 910.53 tonnes which is at lowest level since February 2009. Further, weak global market sentiments prevented sharp fall in prices. The yellow metal touched an intra-day low of $1272. .64/oz and closed at $1287.1/oz in the yesterdays trading session. In the Indian markets, prices traded on a positive note and gained around 0.2 percent on account of depreciation in the Rupee and closed at Rs.27,677/10 gms after touching a high of Rs.27 7,718/10 gms on Wednesday. Market Highlights - Gold (% change)
Gold Gold (Spot) Unit $/oz Last 1287.1 Prev. day 0.5 as on 7 August, 2013 WoW -2.7 MoM 4.1 YoY -20.1

Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (Oct13) MCX Gold (Oct13)

Rs/10 gms $/oz

27800.0

-0.9

0.1

6.9

-6.7

1282.5

0.2

-2.4

3.8

-20.5

$/oz

1286.1

0.2

-1.9

0.6

-20.1

Rs /10 gms

27677.0

0.2

-1.9

6.0

-7.4

Source: Reuters

Silver
Taking cues from fall in gold prices, Spot silver prices declined around 0.4 percent in yesterdays trade. However, sharp p downside in prices was cushioned on account of weakness in the DX coupled with positive movement in base metals complex. . The white metal touched an intra intraday low of $19.13/oz and closed at $19.56 in yesterdays trading session. On the domestic front, prices traded on a flat note on account of depreciation in the Rupee and closed at Rs.41,517/kg /kg after touching a high of Rs.41,580/kg on Wednesday.

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (Sept13) MCX Silver (Sept13) Unit $/oz Rs/1 kg Last 19.6 41670.0 Prev day 0.4 -1.5

as on 7 August, 2013 WoW -1.2 -1.8 MoM 2.7 1.0 YoY -30.1 -22.6

$/oz $/ oz

1927.0 19.5

-2.6 -1.0

-3.4 -0.5

0.6 -2.1

-30.8 -30.5

Rs / kg

41517.0

0.0

0.0

2.8

-22.3

Outlook
In todays session, we expect precious metals to trade higher on the back of recovery in global market sentiments. However However, sharp upside in prices will be capped on account of declining trend in SPDR gold holdings. Further, strength in the DX will also prevent positive movement in prices. . In the Indian markets, depreciation in the Rupee will support an upside in prices on the MCX. Technical Outlook
Unit Spot Gold MCX Gold Oct13 Spot Silver MCX Silver Sept13 $/oz Rs/10 gms $/oz Rs/kg valid for August 8, 2013 Support 1283/1278 27500/27400 19.45/19.26 41100/40700 Resistance 1297/1304 27800/27950 19.83/20.02 41900/42300

Source: Reuters

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Thursday| August 8, 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices declined around 0.9 percent in yesterdays trade taking cues from expectations that US Federal Reserve will reduce its bond buying program anytime in current year. However, decline in US crude oil inventories along with weakness in the DX cushioned sharp fall in prices. Crude oil prices touched an intra intra-day low of $104.10/bbl and closed at $104.40/oz /oz in yesterdays trading session. On the domestic bourses, MCX crude August contract fell around 0.8 percent and crude oil prices touched an intra-day low of Rs.6,396/bbl and closed at Rs.6,409/bbl on Wednesday. EIA Inventories Data As per the US Energy Department (EIA) report, US crude oil inventories decline more than expected by 1.32 million barrels to 363.30 million barrels for the week ending on 2nd August 2013. Gasoline stocks gained by 135,000 barrels to 223.60 million barrels and whereas distillate stockpiles shoot up by 469,000 barrels to 126.50 million barrels for the last week. Market Highlights - Crude Oil (% change)
Crude Oil Brent (Spot) Nymex Crude (Sep 13) ICE Brent Crude (Sep13) MCX Crude (Aug 13) Unit $/bbl $/bbl Last 109.4 104.4 Prev. day -0.3 -0.9 WoW 0.5 -0.6 as on 7 August, 2013 MoM 1.1 -0.5 YoY -4.2 11.4

$/bbl

107.4

-0.7

-0.2

0.0

-4.2

Rs/bbl

6409.0

-0.8

0.0

2.5

24.0

Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (Aug 13) Unit $/mmbtu Rs/ mmbtu Last 3.231 200.8 Prev. day -2.2 -2.3

as on 7 August, 2013 MoM -10.67 -8.81 YoY 9.23 22.74

Source: Reuters

WoW -10.67 -8.81

Technical Chart NYMEX Crude Oil

Natural Gas
EIA Inventories Forecast US Energy Information Administration (EIA) IA) is scheduled to release its weekly inventories and US natural gas inventory are expected to increase by 74 billion cubic feet (bcf) for the week ending on 2nd August 2013. Outlook From the intra-day day perspective, we expect crude oil prices to trade o on a higher note on the back of declining trend in API and US crude oil inventories coupled with recovery in global market sentiments sentiments. Further, increase in Chinese exports and expectations of more stimulus measures from Bank of Japan to achieve inflation ta target of 2 percent will support an upside in prices. However, sharp upside side in prices will be capped on account of strength in the DX. . In the Indian markets, depreciation in the Rupee will support an upside in prices on the MCX. Technical Outlook
Unit NYMEX Crude Oil MCX Crude Aug13 $/bbl Rs/bbl valid for August 8, 2013 Support 103.60/102.80 6350/6300 Resistance 105.30/105.90 6450/6490
Source: Telequote Source: Telequote

Technical Chart NYMEX Natural Gas

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Commodities Daily Report

Thursday| August 8, 2013

International Commodities
Base Metals
The base metals complex traded on a positive note in the yesterdays trading session as a result of weakness in the DX. . Further, rise in German industrial production data supported an upside in prices prices. Additionally, decline in LME inventories scenario acted as a positive factor. However, sharp upside in prices was capped on the back of weak global market sentiments. In the Indian markets, depreciation in the Rupee supported an upside in prices on the MCX. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (Aug13) LME Aluminum (3 month) MCX Aluminum (Aug13) LME Nickel $/tonne Rs /kg $/tonne Rs/kg $/tonne Last as on 7 August, 2013 WoW MoM YoY

Prev. day

7020.0 431.7 1801.0 108.6 14012.0 859.5 2107.5 129.3 1853.0

0.3 0.2 0.8 0.3 1.7 1.5 0.1 0.0 0.0

1.9 2.4 -0.2 2.7 1.2 3.9 1.9 4.1 0.4

-10.5 3.2 -0.1 0.6 4.2 5.2 1.6 2.9 -1.1

-6.7 3.5 -5.5 3.9 -10.6 -1.3 10.6 22.7 -0.3

Copper
Copper the leader of the base metals group gained around 0.3 percent yesterday on the back of decline in LME Copper inventories by 0.6 percent which stood at 601,600 tonnes. Further, weakness in the DX coupled with favourable German industrial production data supported an upside in prices. However, sharp upside in prices was capped on account of weak global market sentiments. Further, expectations of cut in stimulus measures by Federal Reserve also prevented fall in prices. The red metal touched an intra-day high of $7028.75/oz /oz and closed at $7020/oz in yesterdays trade. In the Indian markets, prices rose around 0.2 percent on account of depreciation in the Rupee and closed at Rs.431.70/kg 0/kg after touching an intra-day high of Rs.431.10/kg on Wednesday. Outlook For todays session, we expect base metals group to trade higher on the back of recovery in global market sentiments. Further, increase in Chinese exports and expectations of more stimulus measures from Bank of Japan to achieve inflation target of 2 percent will support an upside in prices. Additionally, increase in German industrial production data in yesterdays trade e will act as a positive factor. However, sharp upside in prices will be capped on account of strength in the DX. . In the Indian markets, depreciation in the Rupee will support an upside in prices on the MCX. Technical Outlook
Unit MCX Copper Aug13 MCX Zinc Aug 13 MCX Lead Aug 13 MCX Aluminum Aug13 MCX Nickel Aug 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for August 8, 201 2013 Support 428/424 111.50/110.50 128.50/127.50 107.80/107.00 853/846 Resistance 433/436 113.00/113.80 130.00/130.80 109.20/111.00 865/872

(3 month) MCX Nickel (Aug13) LME Lead (3 month) MCX Lead (Aug13) LME Zinc (3 month) MCX Zinc (Aug13)
Source: Reuters

Rs /kg

$/tonne

Rs /kg

$/tonne

Rs /kg

112.4

-0.4

2.5

-0.4

9.3

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 7th August 6th August Actual Change (%) Change

601,600 5,473,275 203,988 1,052,075 199,625

605,125 5,480,625 204,906 1,055,300 200,200

-3,525 -7,350 -918 -3,225 -575

-0.6 -0.1 -0.4 -0.3 -0.3

Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Thursday| August 8, 2013

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

Current Account Monetary Policy Statement Monetary Policy Statement German Trade Balance BOJ Press Conference ECB Monthly Bulletin Unemployment Claims

Japan Japan China Euro Japan Euro US

5:20am Tentative Tentative 11:30am Tentative 1:30pm 6:00pm

0.65T -

0.73T 26.2B 15.2B 336K

0.62T 27.1B 14.1B 326K

High High High Medium High Medium High

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