Commodities Daily Report

Thursday| July 11, 11 2013

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Research Team
Reena Rohit Chief Manager Non-Agri Currencies and Commodities Reena.rohit@angelbroking.com (022) 2921 2000 Extn :6134 Anish Vyas Research Analyst anish.vyas@angelbroking.com (022) 2921 2000 Extn :6104

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Commodities Daily Report

Thursday| July 11, 11 2013

International Commodities
Overview
US Fed Chairman Ben Bernanke hints it will continue with stimulus. French Industrial Production declined around 0.4 percent in May May. US crude oil inventories fell sharply by 9.9 mn bbl in yesterdays trade. Japans Core Machinery Orders rose sharply by 10.5 percent in May.

Market Highlights (% change)

Last INR/$ (Spot) 59.88 Prev day 0.4

as on 10 July, 2013 w-o-w 0.5 m-o-m -3.0 y-o-y -7.3

Asian markets are trading higher today on the back of statement from US Federal Reserve Chairman Ben Bernanke that highly accommodative policy is required for better future of worlds largest economy US. Further, favorable machinery orders data from Japan also supported an upside in market sentiments. The US Dollar Index (DX) declined around 0.6 percent in the yesterdays trade on the back of statement from Federal Reserve Chairman Ben Bernanke that central banks needs to wait and watch for more favorable labor markets before tapering its asset purchases program. Further, r, mixed reaction in the Federal Reserve minutes which was held yesterday saw that many members were in favor of continuation of bond buying program and want further fall in jobs data, while others opted for reduction in stimulus package exerted downside p pressure on the currency. The DX touched an intra-day day low of 83.64 and closed at 84.23 on Wednesday. The Indian Rupee appreciated around 0.4 percent in yesterdays trading session. The currency appreciated on the back of measures taken by Reserve Bank of India (RBI) to buy dollars for state owned oil companies only from SBI. Further, weakness in the DX in the early part of the trade supported an upside in currency. Additionally, expectations of more measures from RBI along with probability of jewelers banning ning sale of gold coins and bars for six months which will provide relief to Current Account Deficit (CAD) of the country acted as a positive factor for the Rupee. The currency touched an intra intraday high of 59.635 and closed at 59.88 on Wednesday. For the month of July 2013, FII inflows totaled at Rs.949.60 crores th ($161.88 million) as on 10 July 2013. Year to date basis, net capital th inflows stood at Rs.73,127.80 crores ($13,662.70 million) till 10 July 2013. Japans Core Machinery Orders rose sharply ly by 10.5 percent in May as against a decline of 8.8 percent a month earlier.

$/Euro (Spot)

1.2974

1.5

-0.2

-2.1

6.0

Dollar Index NIFTY

84.23

-0.6 0.6

0.9

4.1

6.0

5816.7

-0.7 0.7

0.8

-1.0

10.3

SENSEX

19294.1

-0.7 0.7

0.6

-0.8

5.5

DJIA

15291.7

-0.1 0.1

2.4

2.0

20.9

S&P

1652.6

0.0

2.3

0.6

23.2

Source: Reuters

The Euro appreciated around 1.5 percent in the yesterdays trade on the back of weakness in the DX. Further, upbeat global markets also supported an upside in the currency. Additionally, economic data from the region came better than forecasted also acted as a positive ositive factor. The Euro touched an intra-day day high of 1.2983 and closed at 1.2974 against the dollar on Wednesday. German Final Consumer Price Index (CPI) remained unchanged at 0.1 percent in the month of June. French Industrial Production declined around 0.4 percent in May from rise of 2.2 percent a month ago. Italian Industrial Production grew at slow pace of 0.1 percent in May with respect to decline of 0.3 percent in earlier month.

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Commodities Daily Report

Thursday| July 11, 11 2013

International Commodities
Bullion Gold
Spot gold prices gained more than 1 percent in yesterdays trading session on the back of weakness in the DX coupled with upbeat market sentiments as Fed Chairman Ben Bernankes speech indicating an accommodative monetary policy led to rise in risk appetite appetite. The yellow metal touched an intra-day high of $1265.15/oz /oz and closed at $1263.60/oz in yesterdays trade. In the Indian markets, prices ended on a positive note, rising around 0.4 percent. The commodity closed at Rs.26103/10 /10 gms after touching a high of Rs.26251/10 gms on Wednesday. However, appreciation in the Indian Rupee capped sharp gains in prices on the MCX. Market Highlights - Gold (% change)
Gold Gold (Spot) Unit $/oz Last 1263.6 Prev. day 1.2 as on 10 July, 2013 WoW 1.0 MoM -8.9 YoY -19.8

Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (August13) MCX Gold (August13)

Rs/10 gms $/oz

26040.0

-0.1

11.9

-6.5

-10.5

1256.0

0.0

0.5

-9.2

-20.4

$/oz

1247.4

0.1

-0.4

-9.5

-21.0

Rs /10 gms

26103.0

0.4

-0.7

-6.8

-10.8

Silver
Taking cues from rise in gold prices along with upside in base metals complex, Spot silver prices rose around 0.5 percent in the yesterdays trade. Further, weakness in the DX acted as a positive factor for prices prices. The white metal touched an intra-day high of $19.42 42/oz and closed at $19.30/oz in the yesterdays trading session. On the domestic front, prices traded on a flat note as a result of appreciation in the Indian Rupee and closed at Rs. Rs.40,174/kg after touching a high of Rs.40,500/kg on Wednesday. Market Highlights - Silver (% change)
Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (Sept13) MCX Silver (Sept13) Unit $/oz Rs/1 kg Last 19.3 40940.0 Prev day 0.5 0.1

Source: Reuters

as on 10 July, 2013 WoW -1.8 -2.9 MoM -11.8 -8.6 YoY -28.7 -22.3

$/oz $/ oz

1937.0 19.2

1.4 0.1

-0.9 -2.7

-11.2 -11.3

-28.6 -29.1

Outlook
Precious metal prices are expected to trade on a higher note in todays trade, taking cues from weakness in the DX coupled with upbeat global markets. Further, statement from US Federal Reserve Chairman Ben Bernanke indicating a continuation of stimulus measures will act as a major supportive factor for prices. In the Indian markets however, appreciation in the Rupee will cap sharp gains in prices on the MCX. Technical Outlook
Unit Spot Gold MCX Gold Aug13 Spot Silver MCX Silver Sept13 $/oz Rs/10 gms $/oz Rs/kg valid for July 11 11, 2013 Support 1277/1272 26000/25900 19.70/19.50 39900/39500 Resistance 1292/1299 26300/26450 20.10/20.40 40700/41200

Rs / kg

40174.0

0.0

-2.0

-9.0

-23.8

Source: Reuters

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Thursday| July 11, 11 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices gained sharply by around 3 percent in yesterdays trade on the back of more than forecasted decline in US crude oil inventories. Further, unrest and political turmoil in Egypt also supported an upside in prices. Additionally, weakness in the DX acted as a positive factor. Crude oil prices touched an intra intra-day high of $106.66/bbl and closed at $106.50/bbl in yesterdays trading session. On the domestic bourses, prices increased 3 percent in yesterdays trade. The commodity closed at Rs.6,391/bbl /bbl after touching a high of Rs.6,407/bbl on Wednesday. EIA Inventories Data Market Highlights - Natural Gas (% change) As per the US Energy Department (EIA) report, US crude oil inventories declined more than expectations by 9.9 million barrels to 373.90 million barrels for the week ending on 5th July 2013. Gasoline stocks fell by 2.6 million barrels to 221.0 million barrels and whereas distillate stockpiles gained 3.0 million barrels to 123.80 million on barrels for the last week. The factor that is leading to a sharp and consistent fall in oil inventories is the sharp harp increase in oil refining activities in the US US. Slowing demand growth in the US due to increased usage of fuel-efficient efficient cars is shifting the refined oil products to other markets and the export of oil products from the US is seen. Outlook Sharp drawdown in oil inventories is expected to support oil prices to trade higher. Additionally, latest remarks by Fed Chairman, adding that an accommodative monetary policy would be needed for the US economy, has led to a bounce back in sentiments yet again. High risk appetite is expected in todays session and the Dollar Index is expected to weaken due to Ben Bernankes comments. A weake weaker Dollar Index will additionally aid upside in oil prices today. Technical Chart NYMEX Natural Gas In the Indian markets we expect Rupee appreciation to cap sharp gains in prices on the MCX. Technical Outlook
Unit NYMEX Crude Oil MCX Crude July13 $/bbl Rs/bbl valid for July 11, 2013 Support 105.20/103.90 6330/6250 Resistance 107.20/108.40 6450/6520 Natural Gas (NG) Nymex NG MCX NG (July 13) as on 10 July, 2013

Market Highlights - Crude Oil (% change)

Crude Oil Brent (Spot) Nymex Crude (Aug 13) ICE Brent Crude (Aug13) MCX Crude (July 13) Unit $/bbl $/bbl Last 109.0 106.5 Prev. day 0.5 2.9 WoW 2.4 6.9

as on 10 July, 2013 MoM 4.7 11.1 YoY 9.3 26.9

$/bbl

108.5

0.6

2.6

4.4

8.3

Rs/bbl

6391.0

2.9

4.6

14.6

33.9

Source: Reuters

Unit $/mmbtu Rs/ mmbtu

Last 3.662 221.1

Prev. day 0.1 0.9

WoW -0.79 0.05

MoM -3.56 -0.36

YoY 33.12 42.65

Source: Reuters

Technical Chart NYMEX Crude Oil

Source: Telequote

Source: Telequote

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Commodities Daily Report

Thursday| July 11, 11 2013

International Commodities
Base Metals
Market Highlights - Base Metals (% change) The base metals pack traded on a positive note in yesterdays trade on the back of data that indicated an increase in Chinese copper imports. Additionally, optimistic global markets and a weaker Dollar Index also supported an upside in prices. Bernanke, regarding Statement by Federal Reserve Chairman Ben Bernanke continuation in its stimulus spending boosted risk sentiments in the global markets and supported base metal prices that have declined sharply in the last month on the back of expectations of pullback in stimulus by the Fed. In the Indian markets, appreciation in the Rupee capped sharp gains in prices on the MCX.
Unit LME Copper (3 month) MCX Copper (Aug13) LME Aluminum (3 month) MCX Aluminum (July13) LME Nickel (3 month) MCX Nickel (July13) LME Lead (3 month) MCX Lead (July13) LME Zinc (3 month) MCX Zinc Rs /kg 112.6 1.4 0.3 3.6 9.3 $/tonne 1894.0 1.3 1.0 0.4 2.4 Rs /kg 124.3 1.6 -1.0 -1.0 19.4 $/tonne 2071.3 1.5 -0.6 -4.2 10.7 Rs /kg 816.6 1.4 -2.5 -5.8 -9.5 $/tonne 13572.0 1.1 -2.1 -8.9 -16.0 Rs /kg 107.6 1.3 -0.2 -2.6 2.6 $/tonne 1818.0 1.4 0.4 -5.5 -4.4 Rs/kg 412.0 0.8 -3.2 -1.2 -2.6 $/tonne Last 6797.5 Prev. day 0.6 as on 10 July, 2013 WoW -2.8 MoM -13.4 YoY -10.2

Copper
Copper prices traded on a positive note and rose around ound 0.6 percent in yesterdays trading session on the back of positive Chinese imports data. Further, better than forecast economic data from Euro Zone Zone, positive market sentiments in global markets and weakness in the Dollar Index supported an upside in prices. , decline in LME copper inventories around 0.6 percent Additionally, which stood at 646,000 tonnes acted as a positive factor for prices prices. The red metal touched an intra-day high of $6835 835.25/tonne and closed at $6797.5/tonne in yesterdays trade. On the domestic front, prices rose 0.8 percent and closed at Rs. 412/kg after touching a high of Rs.412.50/kg on Wednes Wednesday. Outlook In todays session, we expect base metals prices to trade on a positive note on the back of weakness in the DX coupled with optimistic markets. Further, latest remark by Fed Chairman Ben Bernanke to continue its easy monetary policy will also support an upside in prices. Additionally, increase in Chinas copper imports will act as a positive factor for prices. In the Indian markets, appreciation in the Rupee will cap sharp gains in prices on the MCX. Technical Outlook
Unit MCX Copper Aug13 MCX Zinc July 13 MCX Lead July 13 MCX Aluminum July13 MCX Nickel July 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for July 11, 201 2013 Support 409/406 112.0/111.0 123.50/122.50 106.80/105.80 807/800 Resistance 414/416 113.50/114.50 125.50/126.50 108.50/109.50 825/835

(July13)
Source: Reuters

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 10th July 646,000 5,425,425 194,712 1,020,150 194,875 9th July 650,125 5,433,575 193,416 1,025,050 195,975 Actual Change -4,125 -8,150 1,296 -4,900 -1,100 (%) Change -0.6 -0.1 0.7 -0.5 -0.6
Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Thursday| July 11, 11 2013

International Commodities
Important Events for Today
Indicator Country Time (IST) Actual Forecast Previous Impact

Fed Chairman Bernanke Speaks Core Machinery Orders m/m Monetary Policy Statement BOJ Press Conference ECB Monthly Bulletin German Buba President Weidmann Speaks MPC Member Miles Speaks Unemployment Claims Import Prices m/m Federal Budget Balance

US Japan Japan Japan Euro Euro UK US US US

1:40am 5:20am Tentative Tentative 1:30pm 1:30pm 2:00pm 6:00pm 6:00pm 11:30pm

10.5% -

1.9% 342K 0.1% 42.1B

-8.8% 8.8% 343K -0.6% 0.6% -138.7B 138.7B

High Medium High High Medium Medium Medium High Medium Medium

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