Commodities Daily Report

Monday| July 15, 15 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

Monday| July 15, 15 2013

International Commodities
Overview
US Prelim UoM Consumer Sentiment fell to 83.9-mark mark in July. Indias Industrial Production declined by 1.6 percent in last month. Chinas GDP grew at slow rate of 7.5 percent in Q2 of 2013 2013. Asian markets are trading higher today on the back of economic growth in Chinese economy as per the forecast. Japanese markets closed today on eve of Marine Day. US Producer Price Index (PPI) increased by 0.8 percent in June as against a rise of 0.5 percent in May. Core PPI rose by 0.2 percent in June from earlier increase of 0.1 percent a month ago. Prelim UoM Consumer Sentiment fell by 0.2 points to 83.9-mark mark in July with respect to rise of 84.1-level in June. Indias Industrial Production declined by 1.6 percent in June as against a rise of 2 percent in May. Manufacturing Output fell by 2 percent in June from earlier rise of 2.8 percent a month ago. Chinas Gross Domestic Product (GDP) grew at slow rate of 7.5 percent in Q2 of 2013 as against a rise of 7.7 percent in Q1 of 2013. Industrial Production also grew at slow pace of 8.9 percent in June with respect to rise of 9.2 percent a month ago. The US Dollar Index (DX) declined around 1.8 percent in the last week on the back of statement from Federal Reserve Chairman Ben Bernanke that US economy needs more accommodative policy and will continue with is stimulus measures. Further, rise in risk sentiments in global markets also exerted downside pressure on the currency. The DX touched a weekly low of 82.60 and closed at 83.163 on Friday. On a weekly basis, The Indian Rupee appreciated 0.6 percent on the back of measures taken ken by the Reserve Bank of India (RBI) along with increase in margin by the Securities Exchange Board of India (SEBI). Additionally, upbeat global and domestic markets coupled with weakness in the DX after the Fed comments supported an upside in the curren currency. However, sharp upside in the currency was capped on account of dollar demand from importers and oil firms. The currency touched a weekly high of 59.32 and closed at 59.88 on Friday. For the month of July 2013, FII outflows totaled at Rs.290.30 crores th ($46.10 million) as on 12 July 2013. Year to date basis, net capital th inflows stood at Rs.71,887.90 crores ($13,454.70 million) till 12 July 2013.

Market Highlights (% change)

Last INR/$ (Spot) Prev day

as on 12 July, 2013 w-o-w m-o-m y-o-y

59.881

-0.1 0.1

0.6

-3.6

-7.9

$/Euro (Spot)

1.3066

-0.2 0.2

1.8

-2.0

6.7

Dollar Index NIFTY

83.16

0.3

-1.8

3.1

4.7

6009.0

1.2

2.4

4.3

14.8

SENSEX

19958.5

1.4

2.4

4.8

9.1

DJIA

15464.3

0.0

2.2

2.6

23.0

S&P

1680.2

0.3

3.0

4.2

25.9

Source: Reuters

The Euro appreciated around 1.8 percent in the last week on the back of sharp fall in the DX. Further, upbeat global markets also supported an upside in the currency. Additionally, favorable economic data from the region acted as a positive factor. The Euro touched a weekly high of 1.3201 and closed at 1.3066 against the dollar on Friday. Friday European Industrial Production declined by 0.3 percent in May as against a rise of 0.5 percent a month ago.

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Commodities Daily Report

Monday| July 15, 15 2013

International Commodities
Bullion Gold
Market Highlights - Gold (% change) Spot gold prices gained around 5 percent in the last week on the back of weakness in the DX coupled with upbeat market sentiments after Fed Chairman Ben Bernankes speech on Wednesday indicated an accommodative monetary policy led to rise in risk appetite. The yellow metal touched a weekly high of $1298.36/oz and closed at $1284.29/oz in last trading session of the week. In the Indian markets, prices ended on a positive note, rising around 3 percent. The commodity closed at Rs.26601/10 /10 gms on Friday after touching a high of Rs.26858/10 gms in the last week week. However, appreciation in the Indian Rupee capped sharp gains in prices on the MCX. Gold holdings in the SPDR Gold Trust fell around 2.4 percent in the last week to 939.07 tonnes on 12th July13, falling g to the lowest level since February 2009.
Gold Gold (Spot) Unit $/oz Last Prev. day as on 12 July, 2013 WoW MoM YoY

1284.3 26475.0 1279.8

0.0 -0.5 -0.4

5.0 1.5 5.5

-7.5 -4.1 -7.4

-19.1 -9.0 -19.8

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

Rs/10 gms $/oz

$/oz

1277.8

-0.2

3.5

-7.6

-18.3

Rs /10 gms

26601.0

-0.3

3.0

-4.8

-9.1

Source: Reuters

Silver
Taking cues from rise in gold prices along with upside in base metals complex, Spot silver prices rose sharply around 5.6 percent in the previous week. . Further, weakness in the DX acted as a positive factor for prices. The white metal touched a weekly high of $20.26/oz and closed at $19.86/oz in the last trade of the week. On the domestic front, prices gained around 5 percent and closed at Rs.41,316/kg on Friday after touching a high of Rs.41,948/kg in the prior week. However, appreciation in the Indian Rupee capped sharp gains in prices on the MCX. Holdings in the iShares Silver Trust increased around 1.3 percent in the th previous week to 10,185 tonnes as on 12 July 2013.

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (Sept13) MCX Silver (Sept13) Unit $/oz Rs/1 kg Last Prev day

as on 12 July, 2013 WoW MoM YoY

19.9 41800.0 1966.0 19.8 41316.0

-1.2 -0.2 -1.0 -0.8 -0.9

5.6 0.3 1.8 4.0 4.9

-9.1 -6.1 -9.7 -9.1 -5.1

-27.2 -21.1 -28.5 -27.7 -21.8

$/oz $/ oz

Rs / kg

Source: Reuters

Outlook
Precious metal prices are expected to trade on a higher note in todays trade, taking cues from weakness in the DX. . Further, rise in risk appetite in global market sentiments will act as a major supportive factor for prices. However, decline in SPDR holdings will cap sharp gains in prices. In the Indian markets, depreciation preciation in the Rupee will act as a positive factor for 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 15, 2013 Support 1285/1278 26600/26450 19.90/19.70 41200/40800 Resistance 1300/1307 26900/27050 20.25/20.50 41900/42300

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Monday| July 15, 15 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices rose around 2.6 percent in the last week taking cues from declining trend in inventories coupled with weakness in the DX. Further, unrest and political turmoil in Egypt led to supply concerns from region supported an upside in prices. Additionally, upbeat global markets after Fed comments regarding ng continuation with loose monetary policy acted as a positive factor. However, towards the end of week prices came under pressure and correction was seen on account of forecast by International Energy Agency that supply from non-OPEC OPEC (Organization Petroleum Exporting Countries) will increase in 2014. . Crude oil prices touched a weekly high of $107.45/bbl and closed at $105.95/bbl in last trade of the week. On the domestic bourses, prices gained 0.7 .7 percent in the prior week. The commodity closed at Rs.6,339/bbl on Friday after touching a high of Rs.6,419/bbl in the last week. However, appreciation iation in the Indian Rupee prevented sharp gains in prices on the MCX. 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 110.1 106.0 Prev. day 1.2 1.0 WoW 2.6 2.6 as on 12 July, 2013 MoM 6.5 8.3 YoY 7.3 23.1

$/bbl

108.8

1.0

1.0

5.1

6.3

Rs/bbl

6339.0

0.9

0.7

14.0

32.2

Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (July 13)

as on 12 July, 2013

Unit $/mmbtu Rs/ mmbtu

Last 3.644 219.3

Prev. day 0.9 1.1

WoW 0.75 -0.41

MoM -3.52 0.37

YoY 26.79 30.07

Source: Reuters

Natural Gas
On a weekly basis, Nymex natural gas prices rose around 0.8 percent on the back of weakness in the DX. Further, expectations of warm weather will lead to increase in demand of natural gas for air conditioning supported an upside in prices. However, sharp upside in prices was restricted on account of more than expected rise in US natural gas inventories. Gas prices touched a weekly high of $3.787/mmbtu and closed at $3.644/mmbtu /mmbtu in last trade of the week. On the domestic front, prices fell around 0.4 percent on account of appreciation in the Indian ndian Rupee and closed at Rs.219.3 Rs.219.30/mmbtu on Friday after touching a low of Rs.215/mmbtu in the last week week. Outlook From the intra-day day perspective, we expect crude oil prices to trade on a mixed note on the back of slow economic growth in Chinese economy and decline in its industrial production data coupled with expectations of increase in supply which will add downside pressure pressure. While on the other hand, unrest and political turmoil in Egypt can lead to supply concerns from the region along with weakness in the DX will support an upside in prices. In the Indian markets depreciation preciation in the Rupee will support an upside in prices on the MCX. Technical Outlook
Unit NYMEX Crude Oil MCX Crude July13 $/bbl Rs/bbl valid for July 12, 2013 Support 105.05/104.05 6300/6240 Resistance 106.88/108.05 6410/6480

Technical Chart NYMEX Crude Oil

Source: Telequote

Technical Chart NYMEX Natural Gas

Source: Telequote

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Commodities Daily Report

Monday| July 15, 15 2013

International Commodities
Base Metals
The base metals pack traded on a positive note in the last week on the back of increase in Chinese imports coupled with decline in inventories scenario. . Additionally, optimistic global markets and a weaker Dollar Index also supported an upside in prices. Statement by Federal Reserve Chairman Ben Bernanke, regarding 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 p pullback in stimulus by the Fed. In the Indian markets, appreciation in the Rupee capped sharp gains in prices on the MCX. Market Highlights - Base Metals (% change)
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 (July13)
Source: Reuters

as on 12 July, 2013 WoW 2.7 MoM -11.4 YoY -9.9

Last 6953.3

Prev. day -0.7

$/tonne

Rs/kg

419.7

-0.8

0.9

2.0

-1.5

$/tonne

1839.3

0.4

3.9

-1.7

-3.7

Rs /kg

108.7

0.5

1.7

2.0

4.3

$/tonne

13755.0

0.8

3.3

-3.5

-15.1

Copper
Copper prices traded on a positive note and rose around 2.7 percent in the last week on the back of positive market sentime sentiments in global markets and weakness in the Dollar Index supported an upside in prices. Additionally, increase in Chinese copper imports along with affirmative statement from Fed acted as a positive factor for prices. Further, decline in Shanghai and LME copper pper inventories led to positive movement in prices. The red metal touched a weekly high of $7049.25/tonne and closed at $6953.25/tonne in last trade of the week. On the domestic front, prices rose 0.9 percent but appreciation in the Rupee capped gains and closed at Rs. 419.7/kg /kg on Friday after touching a high of Rs.425.30/kg in the last week. Copper Inventories On the LME inventories declined around 3 percent to 640,775 tonnes and on the SHFE inventories ories dropped 2.7 percent to 168,376 tonnes respectively. Outlook In todays session, we expect base metals prices to trade on a lower note on the back of slow economic growth in Chinese economy economy. However, weakness in the DX coupled with optimistic global market sentiments will cushion sharp fall in prices. . In the Indian markets, depreciation in the Rupee will act as a positive factor for prices on the MCX. Technical Outlook
MCX Copper Aug13 MCX Zinc July 13 MCX Lead July 13 MCX Aluminum July13 MCX Nickel July 13 Unit Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for July 15, 201 2013 Support 417/414 111.80/110.80 123.0/122.20 107.80/106.80 817/811 Resistance 422/426 113.50/114.50 124.50/125.50 109.20/110.0 830/838

Rs /kg

823.3

0.5

1.0

-0.4

-8.0

$/tonne

2067.0

-0.2

1.8

-2.6

9.9

Rs /kg

123.8

-0.1

-0.2

1.1

19.3

$/tonne

1895.3

-0.2

3.0

1.4

1.2

Rs /kg

112.5

0.0

0.9

5.3

8.9

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 12th July 640,775 5,411,425 194,406 1,008,500 193,825 11th July 645,175 5,417,100 194,754 1,014,225 194,375 Actual Change -4,400 -5,675 -348 -5,725 -550 (%) Change -0.7 -0.1 -0.2 -0.6 -0.3
Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Monday| July 15, 15 2013

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

Bank Holiday GDP q/y Fixed Asset Investment ytd/y Industrial Production y/y NBS Press Conference Core Retail Sales m/m Retail Sales m/m Empire State Manufacturing Index Business Inventories m/m

Japan China China China China US US US US

All Day 7:30am 7:30am 7:30am 7:30am 6:00pm 6:00pm 6:00pm 7:30pm

7.5% 20.1% 8.9% -

7.7% 20.3% 9.1% 0.5% 0.7% 5.2 0.2%

7.7% 20.4% 9.2% 0.3% 0.6% 7.8 0.3%

High Medium Medium Medium High High Medium Medium

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