Market Overview (13-January-2015) Bullion: Gold Mcx February future prices settled on the higher side despite strong dollar as safe heaven appeal attracted investors; global economic slowdown fear also underpinned upside. Moreover, fall in global equities also led to risk off rally that was triggered by Greece crises and uncertainty their ahead of election. However, Lockhart Fed president Atlanta, stated that Fed is on track for ‘middle of year’ rate hike, but still there is a concern in the market that Fed may hold its decision if inflation remains subdued. Crude oil: U.S. crude oil February future plunged $2.67 or 5% to end at a near six-year low Monday on continued worries of oversupply, with Goldman Sachs and Societe Generale slashing its price outlook for crude oil. As per our expected view in January Monthly Update’15, Crude oil prices almost touched our mentioned price target of $45 (yesterday’s low was $45.66 a barrels). Natural gas: Natural gas future on Mcx fell to 23-month low after forecasts called for a mid-January warm-up that was expected to crimp gas-fired heating demand. Nymex prices have lost more than 35% since November as surging U.S. production with sluggish demand kept the prices down. Base Metals: Red metal prices on LME dropped to the lowest level since Oct 2009 on shrinking global growth amid continues gain in stockpiles. Copper inventory on London metal exchange approached to 187,400 metric tonnes, the level not seen since June 2013. Weakness in entire base metal complex reflects deteriorating global economy, prompting monetary authority to come up with broad monetary measure to address ongoing fall. However, in near term downside risk to prices will remain in favor, providing selling opportunity on every rise. On domestic front, copper Feb future is looking to head towards Rs 366. Edible oil: Castorseed February future plunged 1.35%, extending the previous session’s losses on Monday, as arrivals of new crop along with sluggish demand kept the prices under pressure; Mustard February future retrieved from its major support of Rs3538 on Friday and continued to move up Monday also. Prices posted 1.26% of gain after tracking bullish news of slumping sowing YoY by 6% and good export demand for mustard meal. Crude palm oil Supply & Demand data: Malaysias palm oil stocks at the end of the December stood at 2.01 million tonnes, down 11.5% from a month ago. Stocks of CPO fell 23.6% to 995,529 tonnes during the period. Crude palm oil production stood at 1.36 million tonnes in December, down 22.0% from a month ago period due to flood in previous month. Palm oil exports were recorded at 1.52 million tonnes in December marginally up from 1.51 million tonnes in November. Malaysia’s palm oil exports during January 1-10 reported down by 19% to 320,714 tonnes. Research Desk Globe Commodity & Currency
Posted on: Tue, 13 Jan 2015 05:10:42 +0000
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