Commodities Daily Report

Friday| August 23, 23 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

Friday| August 23, 23 2013

International Commodities
Overview
US Unemployment Claims increased to 336,000 w/e on 16 August. European Flash Manufacturing PMI rose to 51.3-mark mark in August. German Flash Manufacturing PMI gained to 52-level level in current month. Asian markets are trading higher today on the back of favorable economic data from US and Euro Zone in yesterdays trade showing signs of global economic recovery. US Unemployment Claims increased by 13,000 to 336,000 for week th ending on 16 August as against a rise of 323,000 in prior week. Flash Manufacturing Purchasing Managers' Index (PMI) rose by 0.2 points to 53.9-mark in August from 53.7-level in July. The US Dollar Index (DX) appreciated around 0.4 percent in yesterdays trade on the back of rise in risk aversion in global market in early part of the trade which led to rise in demand for the low yielding currency. Further, statement from Federal Reserve Chairman Ben Bernanke and its members that QE tapering is possible by end of the year if economy improves which supported an upside in the currency. However, sharp upside in currency was capped on account of more than expected rise in initial jobless claims data, which showed signs of slow economic growth. The currency touched an intra-day day high of 81.95 and closed at 81.53 on Thursday. The Indian Rupee depreciated around 0.7 percent in yesterdays trading session. The currency depreciated on the back of statement from Federal Reserve Chairman Ben Bernanke and its s members that QE tapering is possible from year end if economy improves which led to strength in the DX. Additionally, outflow of foreign funds from equities and debt exerted downside pressure on the Rupee. Further, Fitch credit rating agency has warned the Indian government that a downgrade is possible as investors confidence is low. Indias credit rating is just once notch above junk category. In the later part of the trade after the closing hours Finance Minister P. Chidambaram tried to lift the confidence by saying though economic growth in first quarter of fiscal year 2014 remained flat a better growth is likely to be seen in the remaining three ree quarters. The currency touched a fresh low of 65.56 and closed at 64.55 on Thursday. For the month of August 2013, FII outflows totaled at Rs.1668.50 crores nd ($255.73 million) as on 22 August 2013. Year to date basis, net capital nd inflows stood at Rs.64423.80 s.64423.80 crores ($12230.10 million) till 22 August 2013.
th

Market Highlights (% change)

Last INR/$ (Spot) 64.55 Prev day -0.7 0.7

as on 22 August, 2013 w-o-w -5.1 m-o-m -8.0 y-o-y -14.4

$/Euro (Spot)

1.3354

0.0

0.1

1.0

6.3

Dollar Index NIFTY

81.53

0.4

0.4

-0.6

2.6

5408.5

2.0

-11.0

-11.0

-0.2

SENSEX

18312.9

2.3

-9.8

-9.8

0.1

DJIA

14963.7

0.4

-1.0

-3.8

13.6

S&P

1657.0

0.9

-2.3

-2.3

17.2

Source: Reuters

The Euro declined and traded on a flat note in yesterday trade taking cues from strength in the DX. However, sharp downside in the currency was cushioned as a result of recovery in market sentiments coupled with favorable economic data from the region. The Euro touched an intra ntra-day low of 1.3297 and closed at 1.3354 on Thursday. French Flash Manufacturing Purchasing Managers' Index (PMI) remained unchanged at 49.7-mark 49.7 in August. French Flash Services PMI fell by 0.9 points to 47.7-mark 47.7 in current month as against a rise of 48.6-level level in July. German Flash Manufacturing PMI rose by 1.3 points to 52-level level in August from 50.7-mark 50.7 in July. German Flash Services PMI gained by 1.1 points to 52.452.4 mark in August when compared to 51.3-level 51.3 a month ago. European Flash Manufacturing PMI increased by 1 point to 51.3-mark mark in August with respect to 50.3-level 50.3 in July. European Flash Services PMI rise by 1.2 points to 51-level 51 in current month as compared to 49.8-mark 49.8 in prior month.

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Commodities Daily Report

Friday| August 23, 23 2013

International Commodities
Bullion Gold
Market Highlights - Gold (% change) Spot gold prices increased around 0.7 percent yesterday on the back of recovery in the global market sentiments. Further, SPDR gold holdings remained unchanged at 913.52 tonnes in yesterdays trade supported an upside in prices. However, sharp upside in prices was capped as a result of strength in the DX. The yellow metal touched an intra-day day high of $ $1381/oz and closed at $1375.20/oz in yesterdays trading session. In the Indian markets, prices fell around 1 percent and closed at Rs.31,140/10 gms after touching an intra-day day low of Rs. Rs.31055/10 gms on Thursday.
Gold Gold (Spot) Unit $/oz Last 1375.2 Prev. day 0.7 as on 22 August, 2013 WoW 0.7 MoM 2.1 YoY -17.7

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

Rs/10 gms $/oz

31400.0

0.0

14.0

14.0

5.4

1375.5

0.9

3.4

3.1

-17.4

$/oz

1371.2

0.0

0.0

3.2

-16.3

Rs /10 gms

31140.0

-1.0

6.7

12.9

1.1

Silver
Taking cues from rise in gold prices along with upside in base metals complex, Spot silver prices rose around 1.2 percent yesterday. However, strength in the DX prevented sharp upside in prices. The white metal touched an intra-day high of $23.32/oz /oz and closed at $23.10/oz in previous trading session. On the MCX, Silver September contract fell around 0.5 percent yesterday and closed at Rs.51,195/kg after touching an intra intra-day low of Rs.50975/kg on Thursday. Market Highlights - Silver (% change)
Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (Sept13) MCX Silver (Sept13) Unit $/oz Rs/1 kg Last 23.1 52490.0 Prev day 1.2 1.1

Source: Reuters

as on 22 August, 2013 WoW 0.7 23.7 MoM 13.0 23.7 YoY -24.3 -4.0

$/oz $/ oz

2307.0 23.0

0.6 -0.5

4.9 0.1

14.3 16.2

-23.9 -22.3

Outlook
In todays session, we expect precious metals to trade higher on the back of weakness in the DX. Further, upbeat global market sentiments coupled with unchanged SPDR gold holdings will support an upside in the prices. In the Indian markets, appreciation in the Rupee will cap sharp gains 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 23, 2013 Support 1364/1353 30900/30650 22.90/22.60 50700/50200 Resistance 1382/1395 31300/31600

Rs / kg

51195.0

-0.5

9.9

22.3

-9.8

Source: Reuters

Technical Chart Spot Gold

Source: Telequote

23.30/23.50 51500/51900

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Commodities Daily Report

Friday| August 23, 23 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices increased by more than 1 percent yesterday on the back of favorable economic data from US and Euro Zone which led to expectations of rise in demand for the fuel. Additionally, recovery in market sentiments supported an upside in prices. However, sharp upside in prices was capped as a result of strength in the DX. Crude oil prices touched an intra-day day low of $103.5 $103.53/bbl and closed at $105/bbl in yesterdays trading session On the MCX near-month contract, oil prices fell around 0. 0.2 percent and closed at Rs.6729/bbl after touching an intra-day low of Rs.6713/bbl on Thursday. 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 112.5 105.0 Prev. day -0.3 1.1 WoW -0.9 -2.1 as on 22 August, 2013 MoM 1.9 0.3 YoY -4.9 8.0

$/bbl

109.9

0.1

-1.1

1.4

-4.4

Rs/bbl

6729.0

-0.2

3.0

5.3

26.6

Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (Aug 13) Unit $/mmbtu Rs/ mmbtu Last 3.545 227.6 Prev. day 2.1 1.4

as on 22 August, 2013 MoM -4.32 3.93 YoY 24.43 45.80

Source: Reuters

Natural Gas
Nymex natural gas prices rose around 2.1 percent in yesterdays trade on the back of less than expected rise in US natural gas inventories. However, strength in the DX capped sharp gains in the prices. Gas prices touched an intra-day day high of $3.559/mmbtu and closed at $3.545/mmbtu in yesterdays trade. On the MCX, prices gained around 1.4 percent and closed at Rs.227.60/mmbtu on Thursday. EIA Inventories Data US Energy Information rmation Administration (EIA) released its weekly inventories yesterday and US natural gas inventory increased by 57 billion cubic feet (bcf) which stood at 3.063 trillion cubic feet for the week ending on 16thAugust 2013. Outlook From the intra-day perspective, pective, we expect crude oil prices to trade on a mixed note on the back of supply concerns from Middle East after unrest in the region coupled with upbeat global markets markets. Further, weakness in the DX will support an upside in prices. On the other hand, expectations ectations of restart in crude production from Libya will cap sharp gains in prices. In the Indian markets, appreciation preciation in the Rupee will cap sharp gains in crude oil prices on the MCX. Technical Outlook
Unit NYMEX Crude Oil MCX Crude Aug13 $/bbl Rs/bbl valid for August 23, 2013 Support 104.40/103.40 6680/6620 Resistance 105.90/106.70

WoW 6.11 10.11

Technical Chart NYMEX Crude Oil

Source: Telequote

Technical Chart NYMEX Natural Gas

Source: Telequote

6780/6830

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Commodities Daily Report

Friday| August 23, 23 2013

International Commodities
Base Metals
The base metals pack traded on a mixed note in yesterdays trade on the back of statement from Federal Reserve Chairman and its members that QE tapering might be possible by end of the year and strength in the DX. However, sharp downside in prices was cushioned as a result of decline in LME inventories coupled with favorable manufacturing data from China, Euro Zone and US. In the Indian markets, depreciation in the Rupee preven prevented sharp decline in the prices. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (Aug13) LME Aluminum (3 month) MCX Aluminum (Aug13) LME Nickel (3 month) MCX Nickel (Aug13) LME Lead (3 month) MCX Lead (Aug13) LME Zinc (3 month) MCX Zinc (Aug13)
Source: Reuters

as on 22 August, 2013 WoW -0.8 MoM -7.0 YoY -4.6

Last 7295.0

Prev. day 0.3

$/tonne

Rs/kg

470.4

-0.3

4.2

11.5

11.1

$/tonne

1882.3

-1.0

-1.4

2.0

-0.7

Rs /kg

118.3

-1.8

3.7

10.1

14.4

Copper
Copper prices on the LME gained 0.3 percent on the back of favourable manufacturing data from major global economies economies. However, sharp gains in prices were capped on account of QE taper fears after the FOMC minutes on Wednesday and strength in the DX DX. Copper prices touched an intra-day high of $7,389/tonne /tonne and closed at $7,295/tonne in yesterdays trade. On the MCX, the near-month month copper contract declined by 0.3 percent. However sharp decline was prevented as a result of depreciation in the Rupee and closed at Rs.470.40/kg after touching a low of Rs.469.8/kg on Thursday. Outlook In todays session, we expect base metals prices to trade on a positive note on the back of favorable manufacturing data from major global economies in yesterdays trade. . Further, weakness in the DX along with upbeat market sentiments will support an upside in prices. However, sharp upside in prices will be capped on account of weak forecast for decline in US new home sales data. In the Indian markets, appreciation preciation in the Rupee will restrict sharp gains 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 23, 2013 Support 467/462 123.00/122.00 139.80/138.80 117.50/116.50 914/909 Resistance 474/478 125.00/126.00 141.50/142.50 119.20/120.20 930/938

$/tonne

14407.0

0.1

-2.6

2.0

-11.8

Rs /kg

922.9

-0.7

1.5

10.2

2.6

$/tonne

2208.3

-0.5

-0.1

6.9

13.5

Rs /kg

140.8

-1.8

4.3

15.2

31.7

$/tonne

1970.0

0.2

0.3

4.4

6.7

Rs /kg

124.1

-1.0

5.1

12.3

22.4

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 22nd August 565,500 5,431,600 209,868 1,026,100 186,625 21st August 566,925 5,440,275 207,346 1,028,625 189,600 Actual Change -1,425 -8,675 2,522 -2,525 -2,975 (%) Change -0.3 -0.2 1.2 -0.2 -1.6
Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Friday| August 23, 23 2013

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

Treasury Sec Lew Speaks Second Estimate GDP q/q BBA Mortgage Approvals Prelim Business Investment q/q New Home Sales Jackson Hole Symposium

US UK UK UK US All

12:45am 2:00pm 2:00pm 2:00pm 7:30pm Day 2

0.6% 38.8K 0.6% 487K -

0.6% 37.3K -1.9% 1.9% 497K -

Medium High Medium Medium High Medium

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