Mcx Technical Outlook Report for All Major Commodity of India. Mcx Bullion, Mcx Energy and more…
Last week, spot gold prices declined by 0.5 percent to close at $1077.7 per ounce. Fed officials last Wednesday continued to flag December as a likely time for U.S. interest rates to rise after seven years near zero, but the central bank signaled an intention to proceed slowly and steadily after that.
In the mid week, prices rebounded from near six-year lows as indications from the U.S. Federal Reserve that it may move cautiously into the rate hiking cycle weighed on the dollar and prompted short covering.
Gold had rallied last month on speculation that the softness in the global economy could prompt the Fed to delay raising rates until next year. But the U.S. Central bank’s hawkish tone last week triggered a fresh sell-off in bullion.
On the MCX, gold prices declined by 0.5 percent to close at Rs.25372 per 10 gms
Last week, spot silver prices declined by around 0.5 percent to close at $14.2 per ounce. The fall is in tandem with decline in gold prices and strengthening dollar index which rose by around 2.31 percent.
On the MCX, silver prices declined by 0.76 percent to close at Rs.34270 per kg.
Although, the Federal Reserve members are in favour of December rate hike, they also commented about a slow and steady pace of rate hike depending on how the economic conditions warrant, this will lead to bargain hunting at lower levels and support gold prices. Today spot gold prices are trading lower by half a percent in the international markets trading at $1071.1 per ounce. Hence, on the MCX, gold prices are expected to trade lower today
WTI oil prices declined by 0.4 percent while Brent rose by 0.9 percent last week. A weaker dollar and stronger refining margins for gasoline, which could prompt refiners to turn more crude into the motor fuel, helped limit the downside in crude.
While the API report showed a draw in total U.S. crude stocks, inventories at the Cushing, Oklahoma, delivery hub for U.S. crude futures rose by 1.3 million barrels. Large rises in Cushing stocks often tend to weigh on crude prices.
Market remains oversupplied with oil from OPEC as well as Non-OPec nations. Besides, rising crude inventories in the US will exert downside pressure on oil.
Venezuelan oil minister Eulogio del Pino said on Sunday that OPEC cannot allow an oil price war and must take action to stabilise the crude market soon. When asked how low oil prices could go in 2016 if OPEC doesn’t change its policy, he said: “Mid-20s.”
Algeria’s energy earnings are forecast to fall to $26.4 billion next year while foreign exchange reserves will dip to $121 billion after low oil prices cut into the OPEC nation’s economy, Finance Minister Abderrahmane Benkhalfa said. On the MCX, oil prices rose by 4.7 percent to close at Rs.2934 per barrel.
On an intraday basis, we expect oil prices to trade sideways as bargain hunting at lower levels will support prices while the global glut of oil will keep the market sentiments bearish. On the MCX, oil prices are expected to trade sideways today.
Base metals on the LME traded lower owing to weak economic data from China, disappointing Euro zone GDP, and strong US dollar. Also, rising prospects of US rate hike in December this year acted as a negative factor.
On the MCX, all the base metal prices traded lower in line with international trends.
LME Copper prices plunged by 5 percent to the lowest level since 2009 as acts of terrorism in Paris triggered doubt about the possible effects on the global economy, thereby pushing investors away from riskier assets. Further, latest FOMC meeting minutes showed that most participants felt that economic conditions to allow a rate rise could be met by the time of the next meeting.
Besides, data by the National Bureau of Statistics showed Chinese home prices increased by just 0.07% in October, a slowdown from the 0.2% rise in September. moreover, Chile’s Codelco, the world’s biggest copper producer, which reports say has cut its 2016 premium to China for the refined metal by more than a quarter to a three-year low.
MCX copper prices declined 5.5 percent to close at Rs.300.2 per kg on Friday in line with international trends.
We expect Copper prices to trade lower today as ICSG report said global world refined copper market showed an 81,000 tonnes surplus in August, compared with a 3,000 tonnes deficit in July. Besides, latest CFTC data showed hedge funds and money managers increased their net short position by 8,430 lots to 27,827 lots, the biggest since midAugust, will exert downside pressure on copper prices.
On the MCX, copper prices are expected to trade lower today.