BULLION - MCX Gold and Silver may note mixed trade in line with international market but general bias is on the downside. COMEX gold trades in a narrow range near $1320/oz after a 0.5% decline yesterday. Gold fell yesterday amid marginal gain in US dollar and amid no new takeaway from Fed Chairman Jerome Powell�s testimony. Fed Chairman Jerome Powell said on Wednesday that the Fed will stop shrinking its $4 trillion balance sheet later this year in line with market expectations post last week�s FOMC minutes. The US dollar managed to see some gains yesterday as comments from US officials fuelled seeds of uncertainty in US-China trade deal. US Trade Representative Robert Lighthizer said US issues with China are "too serious" to be resolved by promises of more purchases of US goods by Beijing. However, weighing on US dollar is mixed US economic data, Fed�s patient rate hike stance and easing concerns about Brexit amid prospect of a delay. Amid other factors, gold is supported by increased geopolitical tensions relating to India and Pakistan and concerns about Trump administration as Michael Cohen, the president's former attorney, claimed that President Donald Trump committed crimes while in office. ETF investors moved to sidelines awaiting more clarity on price direction. Gold has been on a corrective phase after failing to breach $1350/oz level and has now slipped below $1330/oz level and could see extended decline till $1315/oz. Easing worries about US-China and Brexit and no further shift in Fed�s stance will weigh on price.
ENERGY- Crude Oil- MCX Crude Oil may note mixed trade in line with international market but overall bias is on the upside. NYMEX crude trades mixed near $57 per barrel after a sharp 2.6% rally yesterday. Crude has witnessed mixed trade in last few days as market players react to comments from US and Saudi Arabia. Crude plunged as US President expressed concerns about higher price and called upon OPEC to stabilize prices. Crude recovered as Saudi Arabia retorted Wednesday by saying that the twenty-five countries are taking a very slow and measured approach and that their production cut approach was appropriate. Meanwhile, Saudi Arabia also signaled OPEC may continue production cuts in the second half of this year. Crude rose also as EIA weekly report noted an unexpected 8.647 million barrels decline in US crude oil stocks amid higher refinery demand and sharp plunge in weekly imports. EIA however noted that US crude production has inched up to a fresh record high level of 12.1 million barrels per day. Amid other factors, rally in US and global equity market came to a halt amid skepticism about US-China trade deal, mixed US economic data, slowdown in Chinese economy and increased geopolitical tensions. Risk sentiment weakened also as Michael Cohen, the president's former attorney, said that President Donald Trump committed crimes while in office. Crude may witness choppy trade amid mixed factors however the sharp decline in US crude stocks and OPEC�s insistence on continuing with production cuts will continue to support price.
Natural Gas- MCX Natural gas may note some gains tracking cues from international exchange but upside is limited.
NYMEX natural gas trades higher near $2.8/mmBtu after a minor 0.1% gain yesterday. Natural gas trades higher amid positioning ahead of inventory report. US EIA weekly report today is expected to note a 174 Bcf decline in US natural gas stocks as against 5-year average decline of 104 Bcf. A bigger than average decline in stocks will widen the deficit in US market. Also supporting price is forecast of cold weather in large parts of US in early March which will keep heating demand high. However, weighing on price is subdued demand expectation with nearing end of winter season and higher US gas production. Natural gas may trade sideways to positive ahead of inventory report however the momentum will continue only if EIA notes a bigger than expected decline in stocks.
BASE METAL - Base metals on LME trade sideways to lower today after a positive close yesterday. LME Lead was the best performer with 2.1% gains followed by nearly 0.7% rise in Nickel prices and 0.6% gains in Aluminium prices. In other metals both Copper and Zinc ended with 0.2% gains.
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