MTECHTIPS COMMODITY NEWS

MTECHTIPS:-Markets pricing in QE3: MCX Gold, Silver display steady uptrend

The Federal Reserve is planning to buy $40 billion in mortgage securities a month.The purchase is open-3ended meaning the Fed will continue to buy the securities until satisfied by the economic conditions; particularly unemployment.Finally, it seems that markets are in the process of pricing in the impact of QE3 announced by US Federal Reserve on Thursday. Gold and silver prices are exhibiting a steady uptrend on India's MCX. Gold for October delivery climbed 0.2% at Rs 32391 in the initial hours of the trade, even as silver climbed 0.51% to scale 65624.With the QE3 announcement, silver and gold had been unleashed on the MCX Thursday: silver prices at one time surged by 2.48% on the MCX to touch 64869. Gold prices surged 1.22% to touch 32254.The FederalReserve is planning to buy $40 billion in mortgage securities a month. The purchase is open-ended meaning the Fed will continue to buy the securities until satisfied by the economic conditions; particularly unemployment.

MTECHTIPS:-Global Gold rises $12 to reach $1,746/oz on QE3 announcement

The global gold prices edged higher in the immediate aftermath of the FOMC announcement that the Federal Reserve has embarked upon more quantitative easing of United States monetary policy (QE3) About 15 minutes before the FOMC announcement gold backed off a bit on some nervous profit taking and position evening.The FOMC statement that said the Fed will now pump $40 billion a month into the United States financial system sunk the United States dollar index to a fresh four-month low, while gold popped to a fresh six-month high of $1,756.30, basis December Comex futures.December gold last traded up $12.00 at $1,746.00 on the Comex division on the New York Mercantile Exchange.

MTECHTIPS:-QE3: May not be a U-turn for the global economy

The QE3 is a relief measure, but may not facilitate a U-turn for the US, as well as the global economy, according to Martin Patrick, Economist, and Director; Rural Academy for Management Studies, Kochi.No doubt, measures like these in a phase of downturn bring some relief. But will it facilitate a U-turn? It may not he said.The technicals of the Federal Reserve announcement will have to be studied before a conclusion should be reached, he said.The sheer size of the problem evades easy solutions.With the QE3 announcement, silver and gold had been unleashed on the MCX Thursday: silver prices at one time surged by 2.48% on the MCX to touch 64869. Gold prices surged 1.22% to touch 32254.The Federal Reserve is planning to buy $40 billion in mortgage securities a month. The purchase is open-ended meaning the Fed will continue to buy the securities until satisfied by the economic conditions; particularly unemployment.If the outlook for the labor market does not improve substantially, the committee will continue its purchases of agency mortgage-

backed securities, undertake additional asset purchases and employ its other policy tools as appropriate, the FOMC said in a statement.

MTECHTIPS:-India Coal Scam: Four Coal blocks deallocated

Based on the recommendations of an inter-ministerial group (IMG) the Coal ministry deallocated four coal blocks on Thursday.Castron Mining, Fieldmining and Ispat and Domco Smokeless Fuel face de-allocation. Veerangana Steel will have to forego nearly Rs. 2.5 crore, a part of its bank guarantee for three blocks.Further, Monnet Ispat and Energy has been asked to deposit about Rs 90 crore of bank guarantee. If Monnet fails to commence production from the Utkal-B2 block in Odisha by March 2013, its bank guarantee will be forfeited.

MTECHTIPS:-QE3 is on; is it wise to go long on Copper?

Monetary stimulus in US, a reduction in tail-risk in Europe and anticipated stimulus measures in China; all may come together to provide a stable outlook for copper prices in the near-term.But experts stress on the word short term. This is because stimulus measures are not guaranteed success; the surge may be there for a while, only to return to reflecting fundamental realities. The fact that the current stimulus measure announced by the Federal Reserve is the third in a round highlights the magnitude of the problem. Almost $2.3 trillion in debt purchases has already been spent and every time it happened markets rallied only to return to crisis levels and from there to eye stimulus measures, again.The election year theatrics and hyped up leadership transitions add fuel to fire.Coppers performance indicates that fund managers believe that stimulus packages will do wonders for the U.S. and Chinese economies, said Ted Arnold, a London-based independent consulting minerals economist to Marketwatch. I personally doubt if they will.The QE3 is a relief measure, but may not facilitate a U-turn for the US, as well as the global economy, according to Martin Patrick, Economist, and Director; Rural Academy for Management Studies, Kochi.