DAILY MCX MORNING UPDATES 03-Sep-2018

BULLION:-

Gold edged lower on Monday during Asian market trades, with prices breaking back below the psychological $1,200 level as the dollar rose on the back of worries about escalating global trade tensions. US markets are closed due to US labor day holiday. Markets are nervous about the escalating trade conflict between the United States and China, after U.S. President Donald Trump said last week that he wanted to move ahead on a plan to impose tariffs on Chinese imports worth $200 billion. Trump said on Saturday there was no need to keep Canada in the North American Free Trade Agreement and warned Congress not to meddle with the trade negotiations or he would terminate the trilateral trade pact altogether. Gold prices have fallen about 8 percent so far this year amid rising U.S. interest rates, international trade disputes and the Turkish currency crisis, with investors preferring the dollar as a safe-haven. The dollar index, which measures the greenback against a basket of currencies, was up 0.1 percent at 95.204. Hedge funds and money managers cut their net short positions in COMEX gold contracts in the week to Aug. 28 for the first time in more than a month, U.S. Commodity Futures Trading Commission (CFTC) data showed on Friday. Holdings of SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, fell 0.35 percent to 755.16 tonnes on Friday from Thursday. The U.S. Mint sold 21,500 ounces of American Eagle gold coins in August, down 38.6 percent from the previous month.

METALS:-

London copper was sitting at its lowest in 10 days on Monday as jitters over renewed trade tensions between the United States and China weighed on risk appetite and pushed up the dollar. China’s manufacturing activity grew at the slowest pace in more than a year in August, with export orders shrinking for a fifth month and employers cutting more staff, a private survey showed on Monday. China is still determined to reform and wants to work with all parties to build an open world economy, Chinese President Xi Jinping said on Sunday, reiterating Beijing’s message amid a bitter trade war with Washington. China will strictly prevent ‘haphazard investment and redundant development’ in the automobile industry, apparently referring to proposed rules on automakers’ investments in new capacity. Copper production at Codelco, Chile’s state-owned copper mining company, rose 2 percent in the first half of 2018 to 813,000 tonnes, Chief Executive Nelson Pizarro said on Friday. Hedge funds and money managers trimmed their net short positions in COMEX copper futures and options, in the week to Aug. 28 U.S. Commodity Futures Trading Commission (CFTC) data showed on Friday.

ENERGY:-

Oil prices dipped on Monday amid rising supply from OPEC and the United States, although expectations of falling Iranian output once US sanctions bite from November provided some support. Output from the producer cartel of the Organization of the Petroleum Exporting Countries (OPEC) rose by 220,000 barrels per day (bpd) between July and August, to a 2018-high of 32.79 million bpd, a Reuters survey found. Output was boosted by a recovery in Libyan production and as Iraq's southern exports hit a record. Meanwhile, US drillers added oil rigs for the first time in three weeks, energy services firm Baker Hughes reported on Friday, increasing the rig count by 2 units to 862. The high rig count has helped lift US crude oil production by more than 30 per cent since mid-2016, to 11 million bpd. Saudi Arabia will report August crude oil production of 10.424 million b/d, an OPEC source told S&P Global Platts on Friday. The figure represents a 136,000 b/d increase from July, when Saudi Arabia, OPEC's largest producer and the world's largest crude exporter, self-reported production of 10.288 million b/d. The kingdom supplied to market 10.467 million b/d in August, the source added on condition of anonymity. That means the sum of crude exported to customers, consumed by Saudi refineries and burned by domestic power plants, slightly exceeded the amount of crude that was pumped out of the ground in the month, indicating a draw of barrels held in storage.

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