Commodity Round UP
Bullion
Gold hits two-week low on U.S. rate hike prospects
Gold fell on Monday to its lowest in nearly two weeks as the dollar strengthened after comments from U.S. Federal Reserve officials increased bets on a U.S. rate hike this year. The Fed is close to hitting its targets for full employment and 2 percent inflation, the Fed's No. 2 policymaker Stanley Fischer said on Sunday.
"The U.S. economic indicators are looking healthy and the probability of a U.S. rate hike will go up further in the coming months, rallying the dollar and putting pressure on gold.
A stronger dollar discourages gold-buying by making the metal more expensive for holders of other currencies.
Gold futures edged lower on MCX due to a weak trend overseas as the dollar strengthened on US interest rate hike hopes this year after the Federal Reserve Vice Chairman Stanley Fischer said country's economy was picking up, eroding demand for the precious metal as a haven investment.
The contract for October delivery was closed at Rs 31370.00 after making low of 31204, down by 0.11% or Rs 34.00 from its previous closing of Rs 31404.00.The open interest of the contract stood at 9524.00 lots.
Energy
Post rally correction pushed Crude oil down
Crude oil shows some correction after skyrocketed move last week. After more than 8% surge last week oil fell almost 3%. Expectations for higher production from US oil companies weighed on prices. The prices are expected to be around $ 50 in near term for that everything is align very nicely with inventory falling and demand from Asia starting to pick up , the only negative now is the constant high production from some middle eastern producers which in turn delay re balancing of crude oil.
Oil prices eased in Asian markets following news that Iraq, OPEC's second-biggest producer, will increase exports by about five percent after an agreement to resume shipments from three oil fields, while the dollar strengthened on speculation the Federal Reserve could hike interest rates this year.
The contract for September delivery was closed at Rs 3216.00, down by 2.31% or Rs 76.00 from its previous closing of Rs 3292.00. The open interest of the contract stood at 15262 lots.
Base Metals
Copper futures edged lower on MCX as investors exited positions in the industrial metal amid soft physical demand for copper in the domestic spot market. Copper further declined due to a weak trend overseas as China’s metal exports ramp up as the US dollar strengthened ahead of the US Fed officials meeting this week.
The contract for August delivery was closed at Rs 318.55, down by 1.12% or Rs 3.60 from its previous closing of Rs 322.15. The open interest of the contract stood at 25569 lots.
Agri commodity
Key highlights
Kharif crops face flood threat
Mentha oil down 0.1% on subdued demand
Crude palm oil down 0.9% on profit-booking
Cardamom up 2% on upsurge in demand
Sugar down 0.47% on low demand, adequate stocks
Turmeric Hits Lower Circuit On Strong Production Estimates
Soyabean futures traded lower on NCDEX as speculators trimmed their positions on reports of higher edible oil imports and lower export demand for soymeal. Soyabean weakened further tracking reports of better production and yield due to good monsoon in the country. But, forecast of heavy rains in Madhya Pradesh, capped some losses in soyabean prices.
The contract for October delivery was closed at Rs 3460, down by 0.37% or Rs 13.00 from its previous closing of Rs 3473. The open interest of the contract stood at 58760 lots.
Jeera futures edged lower on NCDEX as participants trimmed their positions, tracking a weak trend at spot market on subdued demand. Besides, adequate stocks position on higher supplies from producing regions also weighed on jeera prices.
The contract for September delivery was closed at Rs 18320.00, down by 2.53% or Rs 475.00 from its previous closing of Rs 18575.00.The open interest of the contract stood at 58760 lots.
Soya, maize, redgram cut into cotton area in Telangana
Acreage of pulses and coarse grains have gained significantly in Telangana in the ongoing kharif season, while that of the main crops — paddy and cotton — have suffered. The area under coarse grains (ragi, jowar, maize) has gone up to 6.21 lakh hectares (lh) as against the season normal of 5.58 lh. The area under pulses too has gone up to 6 lh from the season normal of 4 lh. The area under redgram, soyabean and maize has gone up significantly as farmers have begun to look at alternatives to cotton. The redgram area almost doubled to 4 lh from the as-on-date average of 2.29 lh. The State grows the pulse crop on 2.60 lh on an average in the season. The greengram area went up to 1.50 lh from the season average area of 1 lh. The maize area went up to 5.63 lakh hectares from the season average area of 4.91 lh. The soya area has breached the 3-lakh-hectares mark against the average area of 2 lh. (Source: HBL)
Soybean sowing is now nearing an end, and total acreage this year is likely to remain around last year's level of 116 lh, despite the sharp drop in sowing Madhya Pradesh and Rajasthan. In MP, acreage was lagging 8.1% on year, while in Rajasthan; it was lagging by 7.3%, as farmers had switched to pulses and other crops but acreage increase in Maharashtra and Gujarat.
U.S. soybean futures eased further on Friday, as the weather outlook for the Midwest bolstered expectations of a huge harvest coming season. The forecast for key growing areas of the U.S. Midwest showed moderate temperatures and some rain, beneficial for the final stages of development for the maturing soybean crop. The USDA on Monday said 72% of the soybean crop was in good to excellent condition, steady from a week ago and above last year's 63 %.
Technical Levels
Gold
Break and sustain below 31200 will take to 31130---31080---31000. Two consecutive closes below 31000 will see more downside panic till 30700---30600 mark.
30600 act as major support in Gold else it could test its resistance level of 31450---31600 mark
Trade with levels only
Silver
Three consecutive closes + weekly close below 45400 will take to 43800---43300 and then to 42300
Any sharp rise will be selling opportunity in Silver for the downside target of 42300
Hurdle and stop loss above 47300
Crude oil
Support at 3135 and Resistance at 3210
Close below 3135 will take it to 3110--3080 and then to 3025 mark in days to come else could test its resistance level of 3210 again
Further upside rally will see only close above 3210 mark
Trade with levels only
Copper
Support at 316 and Resistance at 320---324
Looks weak below 316 we can see downside panic 313—310---306 marks in days to come else could test its resistance level of 320---324 again.
Fresh buying only above 324
Trade with levels only
Soyabean
Support at 3435 and resistance at 3550.
Two consecutive close below 3435 will take it to 3360—3310 mark in days to come else could test its resistance level of 3550.
Further upside rally only above 3550.
Major Economic Data
French Flash Manufacturing PMI – 12:30 P.M
French Flash Services PMI - 12:30 P.M
German Flash Manufacturing PMI - 01:00 P.M
German Flash Services PMI – 01:00 P.M
Flash Manufacturing PMI – 01:30 P.M
Flash Services PMI – 01:30 P.M
New Home Sales – 07:30 P.M
Technical Pick
Sell Copper below 316 Stop loss 320 Target 313—310—306
