Precious Metals are trading largely unchanged on CME whereas domestic prices are down over half a percent each because of the sharp appreciation in the rupee. Gold is trading at 31269.0, down 200 points whereas Silver is losing 229 points to trade at 40653 currently.
Precious Metals rallied sharply in US trading as short covering pushed prices higher on news that President Trump has cancelled a summit with North Korea with CME Gold shooting above the psychological level of 1300.0. The weakness in US dollar index also contributed to the strength in precious metals.
The geopolitical concerns are back on the forefront with the uncertainty surrounding the US-North Korea situation, sanctions on Iran and the trade talks between the US and China which remain unresolved. On the data front, we have the Durable Goods report at 6.00 pm with analysts calling for stronger growth in durable goods whereas the core figures should come in weaker than March.
Gold is trading below support at 31300 and could extend losses to 31200-150 today whereas Silver is also expected to test 40400 if it sustains below 40600 today.
Base Metals extend losses as the rupee appreciates sharply
Base Metals, traded on LME are higher today whereas the stronger rupee has forced domestic prices to trade in losses. LME Lead is down nearly a percent at 2465.50 whereas domestic prices are down nearly two percent. Copper is trading at 466.30, down 0.595 currently.
The intraday bias is likely to remain mixed today. Nickel prices shot up sharply last evening as inventories continued to drop in both LME and SHFE warehouses creating a supply deficit whereas the demand from electric vehicles and stainless steel continue to lend broad-based support to prices.
Aluminium extended gains after Rusal CEO and board resigned in order to ease US sanctions along with requests to the Russian government to buy their output in a bid to save the company. Copper is likely to struggle further and make another attempt at testing support at 464 below which a short-term correction can be expected whereas, on the upside, 475 continues to act as a major resistance level.
Oil prices down nearly three percent; focus on rig count
Crude Oil futures, traded on NYMEX is down nearly two percent at 69.44 whereas domestic crude prices are at 4716.0, down 142 points or 2.92%. Natural Gas is up by about one-third of a percent at 2.92 currently.
Oil prices trended lower last evening and may extend losses today as OPEC indicated that it may be ready to ease cuts and supply the market for the loss of supply from Venezuela and Iran. Crude Oil is down 27 points to 4832.0 and could test support at 4800.0 in intraday.
The OPEC is due to meet in late June and reports indicate that the cartel along with Russia is open to increasing output to cool off prices which hits 4-year highs this week. The increase in inventories in the US also seemed to weigh on prices in intraday.
We maintain a bearish outlook on prices today and the oil rig count from the US should also pressure prices further. Natural Gas may extend its consolidation and may trade with a bearish bias today. Support levels for Crude come into play at 4650.0-4600.0 whereas, on the upside, 4750.0 should act as a resistance level.
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