Commodities Daily Report

Tuesday| January 01, 2013

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Research Team
Nalini Rao - Sr. Research Analyst nalini.rao@angelbroking.com (022) 2921 2000 Extn. 6135

Anish Vyas - Research Analyst anish.vyas@angelbroking.com (022) 2921 2000 Extn. 6104view:

D Vijiya Rao - Research Analyst vijiya.d@angelbroking.com (022) 2921 2000 Extn. 6134view

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Commodities Daily Report

Tuesday| January 01, 2013

International Commodities
Overview
Current Account Deficit of India rose to $22.3 billion in Q2. Chinese Manufacturing PMI for the month of December remained steady at 50.6 as compared to last month. The US law makers have reached a deal to avoid the fiscal cliff issue that would have caused spending cuts and tax increases. That has delayed for two months. The agreement has been done for balance of spending cuts and tax increases would be effective for the delay in the automatic spending cuts. US Dollar Index (DX) remained volatile throughout the day. The index ended 0.1 percent higher as the US law makers were not able to strike a deal to avert the fiscal cliff issue of the nation. This caused risk aversion amongst the global market participants and increased the demand for the low yielding currency that is US Dollar Index. The US law makers were very close to striking a deal but towards the end of the session they failed to arrive on an agreement. US equities settled higher in yesterdays session. Equities witnessed selling pressure in the early part of the session but gained thereafter on hopes that the US lawmakers might be able to arrive upon an agreement to avert the fiscal cliff issue of the nation. US law makers were very near a decision but they could strike a deal. The index touched an intra-day high of 79.96 and closed at 79.87 on Monday.

Market Highlights (% change)

Last INR/$ (Spot) 55.16 Prev day 0.93

as on 31 December, 2012

w-o-w 1.06

m-o-m 4.45

y-o-y 8.71

$/Euro (Spot)

1.2742

-0.28

0.27

-2.38

-5.35

Dollar Index

81.31

0.21

0.26

2.33

1.32

NIFTY

5626.6

-0.02

0.94

-1.14

18.54

SENSEX

18506.57

-0.06

1.08

-1.09

16.70

DJIA

13009.68

1.35

3.35

-0.71

15.56

S&P

1426.2

1.7

0.7

0.71

13.4

Source: Reuters

The Indian Rupee depreciated 0.4 percent on Monday due to month end dollar demand from the importers along with concerns of expected rise in the Current Account Deficit. The rupee had earlier strengthened due to selling of dollars by the exporters and touched a low of 54.62. However, towards the end of the session expectation of rise in the Current Account Deficit depreciated the currency in yesterdays session. The CAD rose to 5.4 percent of GDP in second quarter and stood at $22.3 billion. The rupee closed at 54.99 after touching a low of 55 on Monday. For the December 2012 FII inflows totaled at Rs. 25,087.80 crores till 31st December 2012. While year to date basis, net capital inflows for the year 2012 stood at Rs. 1, 28,359.80 crores.

Euro declined 0.2 due to rise in the risk aversion in the global markets over the US fiscal cliff issue. Strength in the DX also exerted a downside pressure on currency. The currency touched an intra-day low of 1.317 and closed at 1.3194 on Monday.

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Commodities Daily Report

Tuesday| January 01, 2013

Bullion Gold

International Commodities

Market Highlights - Gold (% change)

Gold Gold (Spot) Gold (Spot -Mumbai) Gold (LBMA-PM Fix) Comex Gold (Feb13) MCX Gold (Feb13) Unit $/oz Rs/10 gms $/oz
1677.1 1.3

as on 31 December, 2012 Prev day

1.2

Spot gold prices gained 1.2 percent in yesterdays session due to rise in the risk aversion causing widespread uncertainty over the US fiscal cliff issue. This increased the safe haven buying for the gold prices. However, strength in the DX restricted sharp gains in the gold prices. The yellow metal touched an intra-day high of $ 1,680.1/oz and closed at $ 1,674.3 per ounce on Monday. On the MCX, Gold February contract ended 0.6 percent higher on account of depreciation in the Indian rupee and traced strength in the spot gold prices. Gold prices on the MCX closed at Rs. 30,859/10 gms on Monday after touching a high of Rs. 30,888/ 10gms.

Last
1674.3

WoW
1.0

MoM
-2.9

YoY
8.3

30500.0 1657.5

0.4 0.4

-0.2 0.4

-3.4 -3.0

11.4 3.2

1.1

-2.9

8.9

$/oz Rs /10 gms

30859.0 0.6 0.0 -2.3 11.6

Silver
Spot silver prices gained 1 percent in yesterdays session due to strength in the spot gold prices along with firmness in the base metals pack. However, strength in DX capped gains in the silver prices.

Source: Reuters

Market Highlights - Silver (% change) The white metal touched an intra-day high of $ /oz and closed at $ 30.3 per oz on Monday. In the Indian markets, MCX silver prices gained 0.6 percent and closed at Rs. 57,864 per kg on Monday and touched a high of Rs. 58,030/ kg. Depreciation in the Indian rupee supported an upside in the silver prices on MCX.
Silver Silver (Spot) Silver (Spot -Mumbai) Silver (LBMA) Comex Silver (Mar13) MCX Silver (Mar13) Unit $/oz Rs/1 kg $/oz $/ oz Rs / kg Last
30.3 57750.0 30.0

as on 31 December, 2012 WoW

1.4 -0.7 -0.8

Prev day
1.0 -0.2 -0.7

MoM
-11.4 -8.7 -11.3

YoY
9.3 17.9 14.5

Outlook
In the intra-day, we expect precious metals to higher due to improved buying at lower levels. However, strength in the DX is expected to cap sharp gains in the precious metals. Silver prices might also derive trend from the movement in the base metals pack. In the domestic markets appreciation in the Rupee will exert downside pressure on the precious metals on MCX. Technical Outlook
Unit Spot Gold MCX Gold Feb13 Spot Silver MCX Silver Mar13 $/oz Rs/10 gms $/oz Rs/kg valid for January 01, 2013 Support 1669/1664 30750/30650 30.10/29.95 57500/57200 Resistance 1679/1684 30940/31020 30.40/30.60 58100/58400

3037.5 57864.0

1.5 0.6

1.8 0.2

-11.6 -8.2

11.4 #N/A

Source: Reuters

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Tuesday| January 01, 2013

Energy Crude Oil

International Commodities
Market Highlights - Crude Oil (% change)
as on 31 December,2012 WoW 4.0 1.2 88.61 MoM 4.8 0.2 88.91 YoY -7.9 3.3 98.83

Nymex crude oil prices gained 1.3 percent on the back of expectation of increase in the demand from the major consumers. However, strength in the DX an uncertainty over the fiscal cliff issue capped gains in the crude oil prices. In the international market prices touched a high of $91.99 per barrel and closed at $91.8 bbl in yesterdays session. On the domestic bourses, prices rose on the back of depreciation in the Indian Rupee and closed at Rs.5,015/bbl after touching a high of Rs.5,023/bbl on Monday.

Crude Oil WTI (Spot) Brent (Spot) Nymex Crude (Feb13) ICE Brent Crude (Feb13) MCX Crude (Jan13)

Unit $/bbl $/bbl $/bbl

Last 91.8 111.6 91.82

Prev. day 1.3 0.7 90.8

$/bbl

111.3 5015.0

0.6 0.4

2.3 2.2

0.5 3.6

3.0 #N/A

Natural Gas: Nymex natural gas prices declined 3.4 percent on the back of less than cooler weather along with strength in the DX. Prices touched an intraday low of $3.341 and closed at $3.351 per mmbtu. On the domestic front, prices fell tracing bearishness in the international prices. Prices touched a low of Rs.192.80/mmbtu and closed at Rs.184.9/mmbtu on Monday. Outlook In the intra-day we expect crude oil prices to trade with bearish note as the US law makers are able to agree on a balanced spending cuts and tax increases which could reduce the demand for the crude oil. Strength in the DX is also expected to exert downside pressure on the crude oil prices. In the domestic market appreciation in the rupee is likely to act as a bearish factor for the crude oil prices on MCX.

Rs/bbl

Source: Reuters

Market Highlights - Natural Gas

Natural Gas (NG) Nymex NG MCX NG (Jan 13) Unit $/mmbtu Rs/ mmbtu Last 3.351 184.9

(% change)

as on 31 December, 2012

Prev. day -3.4 -3.4

WoW 0.15 0.0

MoM -5.9 -5.6

YoY 12.11 14.5

Source: Reuters

Technical Chart Nymex Crude Oil

Technical Outlook
Unit NYMEX Crude Oil MCX Crude Jan 13 $/bbl Rs/bbl

valid for January 01, 2013

Support 91.50/90.70 5000/4960

Resistance 92.40/93.20 5050/5090

Source: Telequote

Technical Chart Nymex Natural Gas

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Commodities Daily Report

Tuesday| January 01, 2013

International Commodities
Base Metals
All the base metals pack traded on positive note except for nickel which closed in red. The prices witnessed an upside on the back of hopes of resolution of the US fiscal cliff issue. The positive data from the manufacturing data from China also lent support to the base metal prices. MCX base metals prices, tracking the international prices also increased. Depreciation of rupee also a supported the upside in the base metal prices on MCX. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (Feb13) LME Aluminum (3 month) MCX Aluminum (Dec12) LME Nickel (3 month) MCX Nickel (Dec12) LME Lead (3 month) MCX Lead (Dec12) Rs /kg
127.8 0.9 1.0 4.8 21.1

as on 31 December, 2012 WoW

1.6

Last
7944.3

Prev. day
1.6

MoM
0.5

YoY
4.2

$/tonne

Rs/kg
443.8 1.1 1.7 2.4 10.1

$/tonne
2068.0 0.4 -0.5 0.4 2.4

Copper
Copper prices increased 0.6 percent yesterday. The increase in the prices was due to the positive manufacturing data from the China. The optimism that the US law makers would reach a deal on the fiscal cliff also supported an upside in the copper prices. However, rise in the LME inventories excreted downside pressure on the prices. Strength in the DX also exerted downside pressure on the copper prices yesterday. Copper inventories on LME increased by 0.63 percent in yesterdays session and stood at 320,050 tonnes on Monday as against 318,050 tonnes as on 28th December 2012. Prices of Copper on LME touched a high of $ 7,898.5 per tonne and closed at $ 7,944.25/tonne on Monday. In the domestic markets, MCX copper gained 1 percent tracking the international markets. In the domestic markets, prices of Copper on MCX touched a weekly high of Rs. 444.20 per kg and closed at Rs. 443.75 per kg on Monday. Outlook From the intraday perspective, the base metals are expected to gain due to optimism that the US fiscal cliff issue might be resolved. The prices are also expected to gain strength on the back of favorable manufacturing data from China. However, strength in the DX might restrict gains. In the domestic markets, appreciation in the Indian rupee will exert downside pressure in the metal prices on MCX. Technical Outlook
Unit MCX Copper Feb13 MCX Zinc Jan13 MCX Lead Jan 13 MCX Aluminum Jan13 MCX Nickel Jan 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for January 01, 2013 Support 441/439 112.5/111.5 126.7/126 112.4/111.9 942/935 Resistance 446/449 114/114.8 128/128.8 113.7/114.4

Rs /kg
111.6 0.0 -0.6 -1.2 5.7

$/tonne
17110.0 -0.3 -1.2 0.6 -7.9

Rs /kg
936.4 -0.5 -1.5 0.5 #N/A

$/tonne
2329.0 0.3 0.7 4.9 15.0

LME Zinc (3 month) MCX Zinc (Dec12)

$/tonne
2071.0 0.6 0.0 2.3 11.6

Rs /kg
111.4 0.0 -0.9 1.0 #N/A

Source: Reuters

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 31 December
320050 5210050 139908 1220750 320325
st

28 December
318050 5216675 139074 1223500 323400

th

Actual Change 2,000 -6,625 834 -2,750 -3,075

(%) Change 0.6 -0.1 0.6 -0.2 -1.0

Source: Reuters

Technical Chart LME Copper

Source: Telequote

954/962

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Commodities Daily Report

Tuesday| January 01, 2013

International Commodities
Important Events for Today

Indicator Bank Holiday Bank Holiday Manufacturing PMI French Bank Holiday German Bank Holiday Italian Bank Holiday Bank Holiday Bank Holiday

Country JPY CNY CNY EUR EUR EUR GBP US

Time (IST) All day All day 6:30 am All day All day All day All day All day

Actual -

Forecast 51.0 -

Previous 50.6 -

Impact Low Low High Low Low Low Low Low

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