Commodities Daily Report

Thursday| May 9, 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

Thursday| May 9, 2013

International Commodities
Overview
German Industrial Production increased by 1.2 percent in March. UKs Halifax House Price Index (HPI) gained by 1.1 percent in April. Chinas Consumer Price Index (CPI) rose by 2.4 percent in last month. Asian markets are trading higher today on the back of cut in interest rates by the Bank of Korea coupled with profits better than forecasts from Japanese companies. Chinas Consumer Price Index (CPI) increased by 2.4 percent in April as against a rise of 2.1 percent in March. Producer Price Index (PPI) declined by 2.6 percent in April from previous decline of 1.9 percent a month ago. The US Dollar Index (DX) declined by 0.5 percent in the yesterdays trading session on the back of upbeat global market sentiments which led to fall in demand for the low yielding currency. Further, favorable German industrial production data also acted as a negative factor for the currency. Additionally, US equities traded on a positive note which exerted downside pressure on the DX. The currency touched an intra-day low of 81.78 and closed at 81.95 on Wednesday. The Indian Rupee appreciated marginally by 0.02 percent in yesterdays trading session. The currency appreciated on account of selling of dollars from exporters. Additionally, upbeat global and domestic market sentiments coupled with weakness in the DX supported an upside in the currency. Further, increase in foreign inflows acted as a positive factor for the Indian Rupee. The currency touched an intra-day high 54.005 and closed at 54.07 against dollar on Wednesday. For the month of May 2013, FII inflows totaled at Rs.5,682.60 crores ($1,052.36 million) as on 8th May 2013. Year to date basis, net capital inflows stood at Rs.66,719.0 crores ($12,362.70 million) till 8th May 2013. UKs British Retail Consortium (BRC) Retail Sales Monitor declined by 2.2 percent in April as against a rise of 1.9 percent in March. Halifax House Price Index (HPI) increased by 1.1 percent in April from earlier rise of 0.2 percent a month ago.

Market Highlights (% change)

Last INR/$ (Spot) 54.07 Prev day 0.0

as on 8 May, 2013 w-o-w -0.8 m-o-m 0.6 y-o-y -1.8

$/Euro (Spot)

1.3151

0.6

-0.2

0.6

1.1

Dollar Index NIFTY

81.95

-0.5

0.5

-0.8

3.1

6069.3

0.4

2.3

9.2

18.7

SENSEX

19990.2

0.5

2.5

8.6

9.3

DJIA

15105.1

0.3

2.7

1.6

16.8

S&P

1632.7

0.4

3.2

4.5

19.7

Source: Reuters

The Euro appreciated by 0.6 percent in yesterdays trade on the back of weak dollar index coupled with rise in German Industrial production. Further, optimistic global market sentiments supported currency to trade in green. German Industrial Production increased by 1.2 percent in March from earlier rise of 0.6 percent a month ago. The Euro touched an intra-day high of 1.3194 and closed at 1.3151 against dollar on Wednesday.

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Commodities Daily Report

Thursday| May 9, 2013

Bullion Gold

International Commodities

Spot gold prices increased by 1.4 percent in the yesterdays trading session on the back of weak dollar index. Further demand from China supported prices to trade in green. Additionally, favourable economic data from euro zone also supported prices. However, sharp upside was capped as the rise in stock markets led to the decline in demand for safe heaven. Further, SPDR gold trust holding continued to decline, which acted as a negative factor. The yellow metal touched an intra-day high of $1476.36/oz and closed at $1472.2/oz in yesterdays trading session. In the Indian markets, prices ended on positive note in the yesterday trading session taking cues from spot gold prices and closed at Rs.27093/10 gms after touching an intra-day high of Rs. 27150/10 gms on Wednesday. Appreciation in the Indian rupee capped sharp gains in the prices.

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 1472.2 27000.0 Prev. day 1.4 -0.2

as on 8 May, 2013 WoW 1.1 -0.4 MoM -5.5 -8.1 YoY -8.2 -6.7

1468.0

1.6

0.9

-6.8

-8.4

$/oz

1473.9

1.7

0.4

-5.8

-10.1

Rs /10 gms

27093.0

1.4

2.1

-7.3

-5.4

Source: Reuters

Silver
Spot silver prices ended on flat note in the yesterdays trading session. Optimistic global market sentiments coupled with weakness in DX supported prices. Further, rise in spot gold prices, upside in the base metal prices along with favourable economic data from china and Germany acted as a positive factor. The white metal prices touched an intra-day high of $24.07 /oz and closed at $23.9/oz in yesterdays trade. On the domestic front, prices increased by 0.1 percent taking cues from spot silver prices and closed at Rs. 44906/kg after touching an intra-day high of Rs. 45157/kg on Wednesday. Appreciation in the Indian Rupee prevented sharp upside in the prices.

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (May13) MCX Silver (May13) Unit $/oz Rs/1 kg Last 23.9 45550.0 Prev day 0.0 0.1

as on 8 May, 2013 WoW 1.5 -0.3 MoM -13.5 -14.1 YoY -18.8 -17.6

$/oz $/ oz

2386.0 2389.2

0.5 0.5

-0.5 2.5

-14.0 -13.7

-19.3 -18.8

Rs / kg

44906.0

0.1

2.9

-13.3

-18.6

Source: Reuters

Outlook
In the intraday, we expect precious metals to trade on a negative note on the back of rise in stock markets which has led to decline in demand for safe haven. Further, unfavourable economic data from china along with expectation of weak economic data from US may add downside pressure on the prices. Additionally, SPDR gold trust holding fell by 0.60 percent on Wednesday lowest since early 2009, which may keep prices under pressure. However, weakness in DX 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 Spot Gold MCX Gold June13 Spot Silver MCX Silver May13 $/oz Rs/10 gms $/oz Rs/kg valid for May 9, 2013 Support 1466/1456 26980/26800 24.00/23.80 44700/44500 Resistance 1478/1483 27200/27300 24.30/24.50 45300/45600

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Thursday| May 9, 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices increased by 1 percent taking cues from less than expected rise in US crude oil inventories which led to expectations of rise in demand for the fuel. Further, rise in German industrial production data coupled with fall in the spread between Brent crude oil and Nymex also supported an upside in the prices. Weakness in the DX also acted as a positive factor for the crude prices. Crude oil prices touched an intra-day high of $96.77/bbl and closed at $96.60/bbl in yesterdays trading session. On the domestic bourses, prices gained by 0.8 percent and closed at Rs.5,208/bbl after touching an intra-day high of Rs.5220/bbl on Wednesday. Appreciation in the Indian Rupee capped sharp gains in the prices on the MCX. EIA Inventories Data As per the US Energy Department (EIA) report, US crude oil inventories increased less than expectations by 0.2 million barrels to 395.50 million rd barrels for the week ending on 3 May 2013. Gasoline stocks fell by 0.9 million barrels to 215.10 million barrels and whereas distillate stockpiles rose by 1.8 million barrels to 117.60 million barrels for the last week.
Natural Gas (NG) Nymex NG MCX NG (May 13) Unit $/mmbtu Rs/ mmbtu Last 3.967 214.4 Prev. day 1.2 0.7 WoW -8.04 -8.22 MoM -2.63 -3.64 YoY 62.78 71.79
Source: Reuters

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 96.2 104.7 96.6 Prev. day 1.0 -1.5 1.0 WoW 6.1 5.6 6.1

as on 8 May, 2013 MoM 1.7 -1.2 3.3 YoY -0.9 -5.7 -0.4

$/bbl

104.3

-0.1

4.4

-1.4

-7.4

Rs/bbl

5208.0

0.8

6.9

1.3

0.6
Source: Reuters

Market Highlights - Natural Gas (% change)

as on 8 May, 2013

Technical Chart NYMEX Crude Oil

Natural Gas
EIA Inventories Forecast US Energy Information Administration (EIA) is scheduled to release its weekly inventories and US natural gas inventory are expected to increase by 80 billion cubic feet (bcf) for the week ending on 3rd May 2013. Outlook From the intra-day perspective, we expect crude oil prices to trade higher on the back of less than expected rise in US crude oil inventories. Further, optimistic global market sentiment coupled with weakness in the DX will also support an upside in the oil prices. However, sharp upside in the prices will be capped on account of expectations of increase in US jobless claims data, cut in the global crude demand from EIA along with forecast for rise in crude oil production from OPEC in current year. In the Indian markets, appreciation in the Rupee will prevent sharp upside in the oil prices. Technical Outlook
Unit NYMEX Crude Oil MCX Crude May13 $/bbl Rs/bbl valid for May 9, 2013

Source: Telequote

Technical Chart NYMEX Natural Gas

Support 95.80/95.00 5160/5120

Resistance 97.30/98.20 5240/5290

Source: Telequote

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Commodities Daily Report

Thursday| May 9, 2013

International Commodities
Base Metals
Market Highlights - Base Metals (% change) The base metals pack traded on a positive note on the back of rise in risk appetite in the global market sentiments coupled with weakness in DX. Further, rise in chinas imports and exports in April may ease some concerns over the countrys economic growth which supported prices to trade in green. Additionally, rise in German industrial production acted as a positive factor for the prices. In the Indian market appreciation in the Indian rupee capped sharp upside in 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 111.4 1.6 5.6 -2.0 -0.1 $/tonne 2066.3 1.6 4.9 -1.3 -0.9 Rs /kg 832.6 1.3 4.8 -5.3 -10.7 $/tonne 15402.0 1.3 4.3 -4.4 -11.3 Rs /kg 102.4 1.3 5.3 -0.5 -6.3 $/tonne 1908.0 1.3 4.5 0.0 -7.2 Rs/kg 404.0 1.9 9.8 -2.1 -7.5 $/tonne Last 7420.0 Prev. day 2.0 as on 8 May, 2013 WoW 9.1 MoM -5.4 YoY -8.4

Copper
Copper, the leader of the base metal pack increased by 2.0 percent on the back of upbeat global market sentiments coupled with weakness in DX. Further, favourable economic data from China and Germany eased some concerns over economic growth, which supported prices to trade in green. However, rise in LME inventories by 0.2 percent capped sharp upside in the prices. The red metal touched an intra-day high of $7480/tonne and closed at $7420/tonne in yesterdays trading session. On the domestic front, prices ended on positive note and closed at Rs. 404/kg on Wednesday after touching an intra-day high of Rs 406.8 kg. Appreciation in the Indian Rupee prevented sharp rallies in the prices. Outlook In the intra-day, we expect base metals prices to trade on the negative note on the back of weak economic data from China. Further, expectation of weak manufacturing production data from UK and Rise in US jobless Claims may add downside pressure on the prices. However, optimistic global market sentiments along with weakness in DX may cushion sharp decline in the prices. In the Indian markets, appreciation in the Indian Rupee may add downside pressure on the prices. Technical Outlook
MCX Copper April13 MCX Zinc April 13 MCX Lead April 13 MCX Aluminum April13 MCX Nickel April 13 Unit Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for May 9, 2013 Support 400/396 100.9/100 110.8/109.9 101.8/101 825/817 Resistance 407/410 102.5/103.5 112.5/113.5 103.3/104.2 842/850

LME Zinc (3 month) MCX Zinc (April13)

$/tonne

1898.0

1.2

3.2

-0.6

-4.0

Rs /kg

101.8

1.1

3.8

-1.4

-3.9

Source: Reuters

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 8th May 605,825 5,142,325 178,482 1,049,500 248,200 7th May 604,600 5,160,075 178,206 1,052,725 251,075 Actual Change 1,225 -17,750 276 -3,225 -2,875 (%) Change 0.2 -0.3 0.2 -0.3 -1.1
Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Thursday| May 9, 2013

International Commodities
Important Events for Today
Indicator CPI y/y PPI y/y New Loans ECB Monthly Bulletin Manufacturing Production m/m Spanish 10-y Bond Auction Asset Purchase Facility Official Bank Rate MPC Rate Statement Unemployment Claims NIESR GDP Estimate Country China China China Europe UK Europe UK UK UK US UK Time (IST) 7:00am 7:00am 9 -15
th th

Actual 2.4% -2.6% -

Forecast 2.3% -2.2% 770B 0.4% 375B 0.50% 333K -

Previous 2.1% -1.9% 1060B 0.8% 375B 0.50% 324K 0.1%

Impact High Medium Medium Medium High High High High High High Medium

1:30pm 2:00pm Tentative 4:30pm 4:30pm Tentative 6:00pm 7:30pm

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