Commodities Daily Report

Thursday| August 29, 29 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 29, 29 2013

International Commodities
Overview
Indian Rupee touched all time low of 68.93 in yesterdays trade. US Pending Home Sales declined by 1.3 percent in month of July. GfK German Consumer Climate fell to 6.9-mark mark in month of August. UKs CBI Realized Sales increased to 27-mark mark in the current month.

Market Highlights (% change)

Last INR/$ (Spot) Prev day

as on 28 August, 2013 w-o-w m-o-m y-o-y

68.8

-3.8 3.8

-7.3

-15.6

-19.1

Asian markets are trading higher today on the back of statement from US that limited military action will be taken against Syr Syria along with unfavorable economic data from US in yesterdays trade led to ease in concerns of QE tapering from Federal Reserve. US Pending Home Sales declined by 1.3 percent in July as against a fall of 0.4 percent in June. ned around 0.3 percent in yesterdays trading The US Dollar Index (DX) gained session on the back of more than expected fall in US pending home sales data. However, sharp upside in the currency was capped as a result of rise in risk appetite in global market sentiments in later part of the trade along with expectations that QE tapering from Federal Reserve will be delayed after unfavorable economic data from the US. The currency touched an intra-day day high of 81.64 and closed at 81.47 on Wednesday Wednesday. The Indian Rupee depreciated more than 3 percent in yesterdays trading session. The currency depreciated on the back of month end dollar demand from oil importers and companies. Further, concerns regarding Current Account Deficit (CAD) and economy growth of the country exerted downside pressure on the currency. Additionally, outflow of foreign funds from equities and debt acted as a negative factor. The Reserve Bank of India (RBI) tried to provide respite from free fall in currency by selling dollars at 68.75 68.75-levels but failed to provide support ort to the Rupee. The currency touched an all time low of 68.93 and closed at 68.80 on Wednesday. To provide respite to free fall in the Rupee, the Reserve Bank of India (RBI) has decided to open a forex swap window for meeting the daily dollar requirements ents of three public sector oil marketing companies (IOC, HPCL and BPCL). Under this facility the central bank will undertake buy and sell USD-INR INR forex swaps for fixed period of time with the concerned companies through a designated bank. The facility wil will take place with immediate effect and remain in place till further notice. For the month of August 2013, FII outflows totaled at Rs.4937.70 crores th ($758.56 million) as on 28 August 2013. Year to date basis, net capital th inflows stood at Rs.61,154.70 crores ($11,727.20 million) till 28 August 2013.

$/Euro (Spot)

1.3338

-0.4 0.4

-0.1

0.6

6.2

Dollar Index NIFTY

81.47

0.3

0.3

-0.1

2.5

5285.0

0.0

-9.4

-9.4

-0.9

SENSEX

17996.2

0.2

-8.2

-8.2

-1.6

DJIA

14824.5

0.3

-0.5

-5.1

13.1

S&P

1635.0

0.3

-3.4

-3.4

16.0

Source: Reuters

The Euro declined around 0.4 percent in the yesterdays trade taking cues from strength in the DX. Further, weak economic data from the country exerted downside pressure on the currency However, downside movement in the currency was cushioned on account of recovery in global market mar sentiments. The Euro touched an intra-day day low of 1.3304 and closed at 1.3338 on Wednesday. GfK German Consumer Climate fell to 6.9-mark 6.9 in August as against a rise of 7-level level in July. German Import Prices rose by 0.3 percent in July from earlier fall of 0.8 percent a month ago. Italian Retail Sales fell around 0.2 percent in June with respect to rise of 0.1 percent a month earlier. earlier UKs Confederation of British Industry (CBI) Realized Sales increased to 27-mark mark in August from earlier rise of 17-level 17 in July. Japans Retail Sales declined by 0.3 percent in July as against a rise of 1.6 percent a month ago. ago

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Commodities Daily Report

Thursday| August 29, 29 2013

International Commodities
Bullion Gold
Spot gold prices increased around 0.1 percent yesterday on the back of recovery in the global market sentiments. Further, rise in SPDR gold holdings to 921.03 tonnes supported an upside in prices. However, sharp upside in prices was capped on account of strength in the DX. The yellow metal touched an intra-day day high of $1433.31/oz and closed at $1417.60/oz in yesterdays trading session. On the MCX, Gold October contract traded on a flat note yesterday and closed at Rs.33,715/10 gms after touching an intra intra-day high of Rs.35,074/10 gms on Wednesday. Market Highlights - Gold (% change)
Gold Gold (Spot) Unit $/oz Last 1417.6 Prev. day 0.1 as on 28 August, 2013 WoW 3.8 MoM 6.8 YoY -14.9

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

Rs/10 gms $/oz

34250.0

4.1

24.9

24.9

14.9

1419.5

0.0

4.1

6.7

-14.9

$/oz

1419.0

-0.1

3.5

8.3

-14.9

Rs /10 gms

33715.0

0.0

7.2

19.2

8.9

Silver
Taking cues from strength in the DX along with downside in base metals complex, Spot silver prices fell around 0.5 percent yesterday. Additionally, unfavorable economic data from m US acted as a negative factor for prices. However, sharp downside in prices was cushioned as a result of rise in gold prices. The white metal touched an intra-day day low of $24.21/oz and closed at $24.30/oz in yesterdays trade. ces fell around 2.6 percent and closed at In the Indian markets, prices Rs.55,776/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 24.3 58900.0 Prev day -0.5 3.9

Source: Reuters

as on 28 August, 2013 WoW 6.6 40.1 MoM 22.9 40.1 YoY -21.1 7.7

$/oz $/ oz

2474.0 24.4

1.9 -1.1

7.8 5.9

23.1 22.5

-19.7 -20.9

Rs / kg

55776.0

-2.6

8.4

35.6

-3.2

Outlook
In the Indian markets, Rupee appreciation is expected to exert downside pressure in gold and silver prices both. In the international markets, gold prices are expected to fal fall on the back of correction seen in the markets after a sharp rise in prices in previous trading session. However, sharp downside will be cushioned as a result of upbeat global market sentiments along with weakness in the DX. Technical Outlook
Unit Spot Gold MCX Gold Oct13 Spot Silver MCX Silver Sept13 $/oz Rs/10 gms $/oz Rs/kg valid for August 29, 2013 Support 1403/1393 33250/33000 23.90/23.60 55200/54600 Resistance 1418/1427 33600/33800 24.30/24.60 56200/56800

Source: Reuters

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Thursday| August 29, 29 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices increased around 1 percent yesterday on the back of expectations that tension in Syria will spread to other parts of Middle East region and create supply concerns from the region. Additionally, unfavorable economic data from US led to ease in concerns on QE tapering from the Federal Reserve which supported an upside in prices. However, sharp upside in prices was capped on account o of more than expected rise in US crude oil inventories along with strength in the DX. Crude oil prices touched an intra-day day high of $112.24/bbl and closed at $110.1/bbl in yesterdays trading session. On the domestic bourses, prices fell around 0.1 percent and closed at Rs.7,347/bbl after touching a low of Rs.7,303/bbl on Wednesday. Rupee depreciation prevented sharp fall in prices on the MCX. EIA Inventories Data As per the US Energy Department (EIA) report, US crude oil inventories increased more than expected xpected by 3.0 million barrels to 362.0 million barrels for the week ending on 23rd August 2013. Gasoline stocks dropped by 0.6 million barrels to 217.80 million barrels and whereas distillate stockpiles declined by 0.3 million barrels to 129.0 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 118.2 110.1 Prev. day 0.9 1.0 WoW 4.8 6.0 as on 28 August, 2013 MoM 8.3 2.0 YoY 4.3 14.3

$/bbl

116.6

2.0

6.2

8.5

3.6

Rs/bbl

7347.0

-0.1

8.9

17.5

37.0

Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (Aug 13) Unit $/mmbtu Rs/ mmbtu Last 3.576 238.4 Prev. day -0.2 3.5

as on 28 August, 2013 MoM 0.45 13.42 YoY 35.92 62.73

Source: Reuters

WoW 3.00 6.19

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 65 billion cubic feet (bcf) for the week ending on 23rd August 2013. Outlook From the intra-day day perspective, we expect crude oil prices to trade lower on the back of statement from US that only limited military action will be taken against Syria. Further, more than estimated rise in US crude oil l inventories in yesterdays trade will exert downside pressure on prices. However, sharp downside in prices will be cushioned on account of upbeat global market sentiments along with weakness in the DX. Additionally, forecast for rise in US GDP data in th the evening session will act as a positive factor. In the Indian markets, depreciation in the Rupee will exert downside pressure on prices. Technical Outlook
Unit NYMEX Crude Oil MCX Crude Aug13 $/bbl Rs/bbl valid for August 29, 2013 Support 108.40/107.30 7280/7210 Resistance 110.30/111.20 7410/7470
Source: Telequote

Source: Telequote

Technical Chart NYMEX Natural Gas

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Commodities Daily Report

Thursday| August 29, 29 2013

International Commodities
Base Metals
The base metals pack on the LME traded on a negative note in the yesterdays trading session to unfavorable pending home sales data from US along with strength in the DX. However sharp downside was cushioned due to recovery in market sentiments along with decline in LME inventories apart from Nickel Nickel. In the Indian markets, base metals fell in the range of 1-3 percent in yesterdays trade. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (Aug13) LME Aluminum (3 month) MCX Aluminum Rs /kg 120.7 -2.7 0.2 15.5 15.0 $/tonne 1863.8 -1.2 -2.0 3.5 -2.3 Rs/kg 484.2 -2.1 2.6 17.8 13.9 $/tonne Last 7262.0 as on 28 August, 2013 WoW -0.1 MoM -7.4 YoY -4.6

Prev. day -0.6

Copper
LME Copper prices declined around 0.6 percent yesterday on the back of unfavourable le pending home sales data from US US. Further, stronger DX exerted downside pressure on prices. However, sharp downside was cushioned due to decline in LME copper inventories by 0.3 percent which stood at 574,825 tonnes tonnes. The red metal touched an intraday low of $7252/tonne /tonne and closed at $7262/tonne yesterday. On the MCX, the near-month month copper contract lost 2.1 percent yesterday. The metal touched an intraday low of Rs. Rs.481.80/kg and closed at Rs.484.20/kg on Wednesday. Outlook

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

$/tonne

14224.0

-1.4

-1.1

3.7

-12.7

Rs /kg

941.2

-2.7

1.3

15.9

4.1

$/tonne

2214.0

-0.6

-0.2

7.0

12.0

Rs /kg

146.7

-1.9

2.3

19.4

33.9

$/tonne

1956.0

-1.0

-0.5

5.6

4.7

Rs /kg

127.9

-2.4

2.1

18.2

24.2

LME Inventories In todays session, we expect base metals prices to trade on a mixed note on the back of unfavorable favorable economic data from US in yesterdays trade. However, sharp downside in prices will be cushioned as result of upbeat global market sentiments along with weakness in the DX. Additionally, estimates of rise in US GDP in evening session will be supportive for prices. In the Indian markets, appreciation preciation in the Rupee will push downside 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 29, 2013 Support 480/475 126.50/125.00 145.50/144.50 119.50/118.50 924/914 Resistance 489/493 128.50/129.50 147.80/149.50 121.50/122.50 950/960 Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 28th August 574,825 5,412,975 212,328 1,014,825 185,950 27th August 576,350 5,422,150 211,902 1,024,850 186,525 Actual Change -1,525 -9,175 426 -10,025 -575 (%) Change -0.3 -0.2 0.2 -1.0 -0.3
Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Thursday| August 29, 29 2013

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

Retail Sales y/y German Prelim CPI m/m German Unemployment Change Italian 10-y Bond Auction Prelim GDP q/q Unemployment Claims FOMC Member Bullard Speaks

Japan Euro Euro Euro US US US

5:20am All day 1:25pm Tentative 6:00pm 6:00pm 6:20pm

-0.3% -

0.0% 0.2% -5K 2.2% 330K -

1.6% 0.5% -7K 4.46/1.3 1.7% 336K -

Medium Medium Medium Medium High High Medium

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