BULLION:-
Most of the consumer demand is for light-weight variety, and investment demand for gold is sluggish due to rising interest rates, tighter credit norms, among other factors. Fall in rupee exchange rate has helped arrest impact of a sharp correction in the international prices of gold, which are down nine percent in the current calendar year, even as the price of domestic standard gold has remained more or less stagnant. However, prices in India are down 6.8 percent on average from their peaks. As a result, the country's price-sensitive customers are back in the market and demand is now expected to remain steady after the first half of subdued off taking. Indications are that jewelers have started restocking gold ahead of the festival season which is now just around the corner. However, most of the consumer demand is for jewelers and that too of the light-weight variety, and investment demand is sluggish due to rising interest rates, tighter credit norms among other factors. As a result, overall imports are likely to contract by at least 15 percent, market experts say.
METALS:-
The metal also trades nearly 10% lower year to date, failing to draw the support that might be expected amid geopolitical turmoil around trade-war worries and Turkey’s financial crisis, as focus remains almost exclusively pinned on the stronger dollar. The precious metal has mostly languished just below the psychologically important $1,200 level after dropping beneath this line for the first time in more than a year on Monday. A popular metals exchange-traded fund, the SPDR Gold Trust GLD, +0.93% was up 0.3%, but poised for a weekly loss of 2.8%, while an ETF that tracks gold miners, the VanEck Vectors Gold Miners ETF GDX, +3.08% added 1.2% — trading down 10.5% on the week.“It is becoming increasingly clear that the yellow metal has struggled to maintain its safe-haven allure, with investors rushing to the dollar instead in these times of uncertainty,” said Lukman Otunuga, research analyst at FXTM, in a note Friday. “ With the greenback heavily supported by U.S. rate-hike expectations and safe-haven demand, gold is likely to witness further losses moving forward.” The weakness in the greenback Friday came on the heels of data from the University of Michigan showing that its consumer sentiment index fell to 95.3 in August, from 97.9 in July — the lowest level in 11 months. Meanwhile, after posting broad declines Thursday, industrial metals on Comex ended on a mixed note. Copper saw its September contract HGU8, +0.74% inch up by 0.5% to $2.629 a pound. It still finished about 4.1% lower for the week.
ENERGY:-
The WTI Crude Oil market rallied significantly during the day on Friday, reaching as high as $66.40 before pulling back a bit. That being the case, it looks as if we are making a serious attempt at turning things around, or perhaps traders simply do not want to be short of oil going into the weekend. Either way, we have saved ourselves at a major uptrend line, so it’ll be interesting to see how this plays out. If we can break above the $66.50 level, we could make a serious move towards $68. Otherwise, if we turn around and lose the $65 level again, this market could unwind rather drastically, especially if there strong trading in the US dollar. Brent markets also rallied but gave back quite a bit of the gains, causing me a bit of concern. The $71 level underneath offers plenty of support, but the $72.50 level above is plenty of resistance. As things look now, Brent has lagged WTI for some time, and may continue to do. The US dollar will have its say in this market as well, so if it strengthens that could send oil lower. There’s also concerns about Iranian oil coming off line, so that of course could be bullish. In short, I think this market is going to continue to be extraordinarily volatile and sideways overall.
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