Commodities Daily Report

Tuesday| October 23, 2012

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Overview:

Research Team
Nalini Rao - Sr. Research Analyst nalini.rao@angelbroking.com (022) 2921 2000 Extn. 6135 Anish Vyas - Research Associate anish.vyas@angelbroking.com (022) 2921 2000 Extn. 6104

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Commodities Daily Report

Tuesday| October 23, 2012

International Commodities
Overview
For the current month FII inflows totaled at Rs. 11,247.40 crores. Indian Rupee appreciated 0.5 percent yesterday. Asian markets are trading on a mixed note on the back of slowing corporate earnings and as European leaders make efforts to contain the Euro zone debt crisis. US Dollar Index swung between gains and losses and ended 0.1 percent higher due to rise in the risk aversion amongst the market participants and thereby increase in the demand for the low yielding currency that is US Dollar Index (DX). US equities ended on a flat note as worries of global growth has seen hitting the corporate sales amidst better earnings. Gains were witnessed Technology shares which kept led the markets to end on a flat note. The currency touched high of 79.76 and closed at 79.74 levels on Monday.
INR/$ (Spot)

Market Highlights (% change)

Last
53.55

as on 22 October, 2012

Prev day
0.5

w-o-w
-1.1

m-o-m
-0.2

y-o-y
-6.9

$/Euro (Spot)

1.3059

0.3

0.9

1.0

-6.0

Dollar Index

79.74

0.1

-0.1

0.2

4.1

NIFTY

5717.2

0.6

0.5

0.8

13.2

SENSEX

18793.4

0.6

0.4

0.6

12.0

DJIA

13345.9

0.0

-0.6

-1.6

13.0

The Indian Rupee appreciated by 0.7 percent in the yesterdays trading session. The currency appreciated taking cues from rise in risk appetite in the global markets in the later part of the trade along with weakness in the DX. Additionally, upbeat domestic market sentiments also supported an upside in the currency.

S&P

1433.82

0.0

-0.4

-1.8

15.8

Source: Reuters

However, sharp upside in the currency was capped as result of dollar demand from oil importers. The currency touched a high of 53.435 in yesterdays trade and closed at 53.74 on Monday.

For the current month FII inflows totaled at Rs. 11,247.40 crores till 22 October 2012. While year to date basis, net capital inflows stood at Rs. nd 93,578.20 crores till 22 October 2012.

nd

Euro gained 0.3 percent on the back of optimism that efforts by Spains Prime Minister Mariano Rajoy to cut the deficit were supported by the public. However, strength in the DX restricted sharp gains in the currency. The currency touched a high of 1.3083 and closed at 1.3059 on Monday.

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Commodities Daily Report

Tuesday| October 23, 2012

Bullion Gold

International Commodities

Spot gold prices gained 0.5 percent due to rise in the risk appetite amongst market participants and thereby increasing the appeal for the yellow metal. However, sharp gains were restricted as investors were cautious over Federal Reserve Open Market Committee (FOMC) meeting outcome scheduled on October 24th 2012 along with strength in the DX. The yellow metal touched a high of $1,729 per ounce and settled at $1,728.84 per ounce on Monday. In the domestic markets, MCX Gold prices declined 0.6 percent on the back of appreciation in the Indian Rupee and settled at Rs. 31,068 per 10 gms after touching a low of Rs. 30,982 per 10 gms on Monday.

Market Highlights - Gold (% change)

Gold Gold (Spot) Gold (Spot -Mumbai) Gold (LBMA-PM Fix) Comex Gold (Dec12) MCX Gold (Dec12) Unit $/oz Rs/10 gms $/oz Last
1728.8

as on 22 October, 2012 Prev day

0.5

WoW
-0.4

MoM
-2.0

YoY
5.4

30825.0

-1.0

-0.2

-1.6

16.4

1726.8

-0.6

-0.5

-2.0

5.1

$/oz Rs /10 gms

1725.1

0.1

-0.6

-2.1

5.5

31068.0

-0.6

0.3

-1.2

16.5

Silver
Spot silver prices gained 1.2 percent taking cues from strength in the spot gold prices. However, sharp gains were capped on the back of weakness in the base metals pack along with strength in the DX. The white metal touched a high of $32.44 per ounce and settled at $32.39 per ounce. MCX silver prices fell 0.4 percent due to appreciation in the Indian rupee and settled Rs. 59,614 per kg after touching a low of Rs.59,325 per kg in yesterdays session.

Source: Reuters

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot -Mumbai) Silver (LBMA) Comex Silver (Dec12) MCX Silver (Dec12) Unit $/oz Rs/1 kg $/oz $/ oz Rs / kg Last
32.4 60245.0 3219.0

as on 22 October, 2012 WoW

-0.9 -1.5 -3.1

Prev day
1.2 -1.1 -0.4

MoM
-4.6 -2.0 -4.6

YoY
3.5 13.7 4.5

Outlook
In todays session, we expect precious metals to trade on a firm note on the back of mixed global market sentiments along with weakness in the DX. Further, investors are adopting a cautious approach ahead of the FOMC meeting tomorrow. In the domestic market, appreciation in the Indian rupee is expected to cap sharp gains in the precious metals on MCX. Technical Outlook
Unit valid for October 23, 2012 Support Resistance

3222.7

0.5

-1.5

-5.0

3.4

59614.0

-0.4

-0.6

-4.5

12.9

Source: Reuters

Technical Chart Spot Gold

Spot Gold MCX Gold Dec12 Spot Silver MCX Silver Dec12

$/oz Rs/10 gms $/oz Rs/kg

1719/1714 30950/30850 32.14/31.98 59300/59000

1729/1734 31120/31210 32.55/32.68 60050/60300

Source: Telequote

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Commodities Daily Report

Tuesday| October 23, 2012

International Commodities
Energy Crude Oil
Nymex crude oil prices declined around 1.5 percent yesterday taking cues from expectations that TransCanada Corporation is planning to restart the Keystone pipeline along with slowdown in the global economic growth. Additionally, strength in the DX also exerted downside pressure on the prices. Crude oil prices touched an intra-day low of $88.21/bbl and closed at $88.70/bbl in yesterdays trading session. On the domestic bourses, prices declined by 0.8 percent and closed at Rs.4,809/bbl after touching an intra-day low of Rs.4,794/bbl on Monday. Additionally, appreciation in the Indian Rupee also added downside pressure on the prices. API Inventories Forecast The American Petroleum Institute (API) is scheduled to release its weekly inventories today and US crude oil inventories are expected to increase by 1.8 million barrels for the week ending on 19th October 2012. Outlook We expect crude oil prices to remain weak on the back of worries of slowing demand from the key consuming nations along with expectations of rise in the crude oil inventories. However, weakness in the DX along with mixed global market sentiments is expected to cushion sharp fall in the crude oil prices. Further, supply disruptions from the TransCanada Corporation are expected to cushion sharp fall. In the domestic markets, appreciation in the Indian rupee is expected to exert downside pressure on the crude prices on MCX. Technical Outlook
valid for October 23, 2012

Market Highlights - Crude Oil (% change)

Crude Oil WTI (Spot) Brent (Spot) Nymex Crude (Nov12) ICE Brent Crude (Nov12) MCX Crude (Oct12) Unit $/bbl $/bbl Last
88.3 110.4

as on 22 October, 2012 WoW

-3.9 -4.6

Prev. day
-1.9 -2.0

MoM
-3.7 0.9

YoY
1.2 -1.8

$/bbl

88.7

-1.5

-3.4

-3.5

1.5

$/bbl

109.4

-0.6

-5.5

-0.3

-0.1

Rs/bbl

4809.0

-0.8

-0.5

-1.9

10.0

Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (Oct12)

as on 22 October, 2012

Unit $/mmbtu Rs/ mmbtu

Last
3.44 186.1

Prev. day
-3.88 -5.15

WoW
-1.38 0.32

MoM
19.03 22.03

YoY
-5.62 2.25

Source: Reuters

Technical Chart Nymex Crude Oil

Source: Telequote

Technical Chart Nymex Natural Gas

Unit

Support

Resistance

NYMEX Crude Oil

$/bbl

88.28/87.54

89.76/90.68

MCX Crude Oct12

Rs/bbl

4770/4730

4850/4900

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Commodities Daily Report

Tuesday| October 23, 2012

International Commodities
Base Metals
Market Highlights - Base Metals (% change) The base metals pack traded on a negative note in the yesterdays trade on the back of mixed global market sentiments, strength in the DX along with mixed scenario in the LME inventories. Additionally, slowdown in the Chinese economy and decline in Japans exports also added downside pressure on the prices. In the Indian markets, appreciation in the Rupee added further downside pressure in the prices on the MCX.
Unit LME Copper (3 month) MCX Copper (Nov12) LME Aluminum (3 month) MCX Aluminum (Oct12) LME Nickel (3 month) MCX Nickel (Oct12) LME Lead (3 month) $/tonne
2073.0 -1.9 -2.1 -8.3 8.4

as on 22 October, 2012 WoW

-2.2

Last
7944.0

Prev. day
-0.6

MoM
-2.9

YoY
11.2

$/tonne

Rs/kg

429.0

-1.5

-1.3

-3.1

19.7

$/tonne

1965.0

-0.2

-0.4

-5.7

-7.9

Rs /kg

104.3

-1.4

0.1

-5.5

-1.6

Copper
Copper, the leader of the base metals complex fell by 0.6 percent yesterday on the back of mixed global market sentiments, strength in the DX along with rise in LME Copper inventories by 0.7 percent which stood at 222,425 tonnes. Also, slowdown in the Chinese economy coupled with fall in Japans exports exerted downside pressure on the prices. The red metal touched an intra-day low of $7,930/tonne and closed at $7,944.0/tonne in yesterdays trading session. On the domestic front, prices declined by 1.5 percent as a result of appreciation in the Indian Rupee and closed at Rs.429.0/kg after touching an intra-day low of Rs.428.50 /kg on Monday. Outlook

$/tonne

16605.0

-1.9

-3.2

-7.8

-11.9

Rs /kg

888.2

-2.8

-2.7

-7.5

-5.7

MCX Lead (Oct12) LME Zinc (3 month) MCX Zinc (Oct12)

Rs /kg

110.9

-2.6

-1.1

-7.9

17.0

$/tonne

1863.0

-1.0

-2.9

-11.1

2.6

Rs /kg

98.1

-2.0

-2.4

-11.5

8.6

Source: Reuters

LME Inventories
Unit Copper tonnes tonnes tonnes tonnes tonnes 22nd October
222,425 5,062,875 127,134 1,114,425 300,175

19th October
220,900 5,039,125 127,500 1,116,075 293,675

Actual Change
1,525 23,750 -366 -1,650 6,500

(%) Change
0.7 0.5 -0.3 -0.1 2.2 Source: Reuters

From the intraday perspective base metal prices are expected to trade on a bearish note owing to expectation of weak demand from key consuming nation, China and debt worries of Euro zone. However, weakness in the DX along with mixed global market sentiments is expected to cushion sharp fall in the intra-day. In the domestic markets appreciation in the Indian rupee is expected to keep the MCX base metal prices bearish in todays session. Technical Outlook
Unit MCX Copper Nov12 MCX Zinc Oct12 MCX Lead Oct12 MCX Aluminum Oct12 MCX Nickel Oct12 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for October 23, 2012 Support 427/424 97.5/96.5 110/109.2 103.8/103.1 882/875 Resistance 431/434 98.8/99.5 111.5/112.4 105/105.6 894/902

Aluminum Nickel Zinc Lead

Technical Chart MCX Copper

Source: Telequote

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Commodities Daily Report

Tuesday| October 23, 2012

International Commodities
Important Events for Today

Indicator BBA Mortgage Approvals Belgium NBB Business Climate BOE Gov King Speaks

Country UK Euro UK

Time (IST) 2:00pm 6:30pm 10:30pm

Actual -

Forecast 30.9K -10.8 -

Previous 30.5K -11.6 -

Impact Medium Medium High

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