Commodities Daily Report

Wednesday| January 09, 2013

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Research Team
Nalini Rao - Sr. Research Analyst nalini.rao@angelbroking.com (022) 2921 2000 Extn. 6135

Anish Vyas - Research Analyst anish.vyas@angelbroking.com (022) 2921 2000 Extn. 6104view:

D Vijiya Rao - Research Analyst vijiya.d@angelbroking.com (022) 2921 2000 Extn. 6134view

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Commodities Daily Report

Wednesday| January 09, 2013

International Commodities
Overview
Euro region retail sales increased to 0.1 percent in November. German Factory Orders m/m declined to 1.8 percent in November Euro region unemployment rate rose to 11.8 percent in November.

Market Highlights (% change)

Last INR/$ (Spot)
54.95

as on 08 January, 2013

Prev day
0.5

w-o-w
0.1

m-o-m
-1.3

y-o-y
-4.1

Asian markets are trading on a firm note taking cues from the positive earning from companies such as Alcoa Inc. and Nikkei advanced as Yen $/Euro (Spot) rebounded. US Dollar Index (DX) gained 0.1 percent due to rise in the risk aversion in Dollar the global markets ahead of the corporate earnings. This increased the Index* demand for the low yielding currency that is US Dollar Index. The index however had traded lower in the early part of the day owing to NIFTY expectation that the European Central Bank might refrain from cutting the interest rates in meeting scheduled on Thursday.
SENSEX

1.308

-0.3

-0.9

0.9

2.8

80.34

-0.3

0.6

0.7

-1.1

6001.7

0.2

1.6

4.8

26.2

19742.5

0.3

1.6

4.8

24.4

US equities settled lower as the investors adopted a cautious approach ahead of the corporate earnings results of the fourth quarter. However sharp decline in the stocks was cushioned as investor confidence DJIA improved in the January. The index touched an intra-day high of 80.57 and closed at 80.45 on Tuesday.
S&P

13328.85

-0.4

1.7

1.9

7.8

1457.2

-0.3

2.8

2.76

14.0

The Indian Rupee witnessed volatile movement in yesterdays session with currency moving from appreciation to depreciation and back to appreciation. The currency appreciated 0.5 percent on Tuesday. The currency had depreciated tracing mixed global market sentiments along with dollar demand from the oil refiners. However, weakness in DX during the first half of the trade along with affirmative statement by the Finance Minister that the government would be able to tackle the alarming Current Account Deficit led the rupee to appreciate. Sustained capital inflows also added to appreciation in the currency. The rupee closed at 54.95 after touching an intra-day high of 54.92 on Tuesday.

Source: Reuters

Euro swung between gains and losses and ended 0.3 percent lower on Tuesday. Market participants adopted a cautious approach before the European Central Bank meeting scheduled on Thursday. The bank is likely to refrain from further interest rate cuts. Strength in the DX in the later part of the day along with unfavorable data from region exerted downward pressure on the currency. The currency touched an intra-day low of 1.3055 and closed at 1.308 on Tuesday.

For the current month 2013 FII inflows totaled at Rs 6,764.60 crores till Euro region retail sales increased to 0.1 percent in the month of th 08 January 2013. While year to date basis, net capital inflows for the November as against a decline of 0.7 percent in October. The region unemployment rate rose to 11.8 percent in November as year 2013 stood at Rs. 6,764.60 crores. compared to 11.7 percent in October. German Factory Orders m/m declined to 1.8 percent in November as compared to 3.8 percent in October.

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Commodities Daily Report

Wednesday| January 09, 2013

International Commodities
Bullion Gold
Spot gold prices gained 0.7 percent in yesterdays session. There were reports of improved buying by the China due to signs of economic recovery and lower prices of the yellow metal. Apart from this, Japanese pension funds are also likely to increase gold holding as the government adopts aggressive monetary easing programs to boost the economic growth and targets deflation in the nation. The yellow metal touched an intra-day high of $ 1,661.9/oz and closed at $ 1,658.6 per ounce on Tuesday. On the MCX, Gold February contract ended 0.4 percent higher taking cues from the trend in the spot gold prices. Gold prices on the MCX closed at Rs. 30,974/10 gms on Tuesday after touching a high of Rs. 30,995/ 10gms. However, appreciation in the rupee, capped gains in the gold prices.

Market Highlights - Gold (% change)

Gold Gold (Spot) Gold (Spot -Mumbai) Gold (LBMA-PM Fix) Comex Gold (Feb13) MCX Gold (Feb13) Unit $/oz Rs/10 gms $/oz Last
1658.6

as on 08 January, 2013 Prev day

0.7

WoW
-0.9

MoM
-2.6

YoY
2.6

30375.0

-0.3

-0.4

-1.5

9.7

1656.0

0.7

#N/A

-2.7

2.4

$/oz Rs /10 gms

1661.5

1.0

-0.8

-2.5

2.8

30974.0

0.4

0.4

-1.0

11.6

Source: Reuters

Silver
Spot silver prices gained 0.7 percent taking cues from firmness in the spot gold prices and weakness in the DX in the first half of the trading day. Weakness in the base metals pack however, capped gains in the base metals pack. The white metal touched an intra-day high of $ 30.52/oz and closed at $ 30.34 per oz on Tuesday. In the Indian markets, MCX silver prices rose 0.8 percent and closed at Rs. 58,470/kg on Tuesday and touched an intra-day high of Rs. 58,650 / kg. Appreciation in the Indian rupee restricted gains in the silver prices on MCX.

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (Mar13) MCX Silver (Mar13) Unit $/oz
58270.0 -0.1

as on 08 January, 2013 WoW

0.1

Last
30.3

Prev day
0.7

MoM
-8.2

YoY
5.7

0.9

-6.0

10.9

Rs/1 kg
3039.0 0.8 1.5 -7.5 3.4

$/oz
3041.5 1.3 0.8 -8.0 6.1

$/ oz
58470.0 0.8 1.0 -6.4 12.7

Rs / kg
Source: Reuters

Outlook
Technical Chart Spot Gold In today session, we expect precious metals to trade lower owing mixed global market sentiments and strength in the DX. However, physical buying by the Asian countries might cushion fall in the prices. In the domestic markets, appreciation in the rupee is expected to act as bearish factor for the MCX precious metals. Technical Outlook
Unit Spot Gold MCX Gold Feb13 Spot Silver MCX Silver Mar13 $/oz Rs/10 gms $/oz Rs/kg valid for January 09, 2013 Support 1652/1647 30850/30750 30.25/30 58200/57700 Resistance 1663/1668

Source: Telequote

31050/31150 30.50/30.70 58700/59100

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Commodities Daily Report

Wednesday| January 09, 2013

International Commodities Energy

Crude Oil
Nymex crude oil prices increased around 0.1 percent yesterday taking cues from expectations of rise in demand for the fuel from the US. Additionally, Irans crude oil exports declined by 40 percent on account of sanctions from the US also supported an upside in the prices. Apart from that weakness in the DX also acted as a positive factor for the crude prices. Oil prices touched an intra-day high of $93.35/bbl and closed at $93.26/bbl in yesterdays trading session. On the domestic bourses, prices gained by 0.7 percent as a result of depreciation in the Indian Rupee and closed at Rs.5,149/bbl after touching an intra-day high of Rs.5,156/bbl on Monday. API Inventories The American Petroleum Institute (API) Crude stockpiles increased by 2.4 million barrels in the week ended Jan. 4, 2013 as compared to the expectations for a 1.5 million barrel. US Gasoline stocks expanded by 7.9 million barrels in the week, compared with expectations for a 2.3 million barrel build. Distillate fuels, increased 5.9 million barrels, compared with expectations for a 2 million barrel rise. Outlook Technical Chart NYMEX Crude Oil In the intra-day we expect crude oil prices to trade with bearish note due to strength in the DX along with rise in the crude oil inventories. However, favorable data from the major consuming nations is expected to cushion fall in the crude oil prices. In the domestic markets, appreciation in the rupee is expected to exert downside pressure in MCX Crude oil prices. Technical Outlook
Unit NYMEX Crude Oil MCX Crude Jan 13 $/bbl Rs/bbl valid for January 09, 2013

Market Highlights - Crude Oil (% change)

Crude Oil WTI (Spot) Brent (Spot) Nymex Crude (Feb13) ICE Brent Crude (Feb13) MCX Crude (Jan13) Unit $/bbl $/bbl $/bbl 111.9 $/bbl 5120.0 Rs/bbl -0.6 1.8 0.5 0.7 Last 93.2 114.4 93.2 Prev. day 0.0 0.5 0.0 WoW 1.5 2.5 1.4

as on 08 January, 2013 MoM 9.1 5.8 8.4 YoY -8.2 1.3 -8.3

4.6

-1.0

9.1

-4.2

Source: Reuters

Market Highlights - Natural Gas (% change)

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

as on 08 January, 2013

Unit $/mmbtu Rs/ mmbtu

Last 3.217 177.9

Prev. day -1.50 -1.39

WoW -4.00 -3.89

MoM -9.41 -8.16

YoY 5.06 9.28

Source: Reuters

Support 92.50/91.70 5080/5040

Resistance 93.90/94.70 5160/5200

Source: Telequote

Technical Chart NYMEX Natural Gas

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Commodities Daily Report

Wednesday| January 09, 2013

International Commodities
Base Metals
Base metal prices declined yesterday taking cues from weak factory orders from Germany. Strength in the DX also exerted downside pressure in the metal prices. In the domestic markets, the prices tracked the bearishness in the international prices. Appreciation in the Indian rupee also supported the fall in the metal prices. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (Feb13) LME Aluminum $/tonne
2065.0 0.0 -0.1 -1.1 2.3

as on 08 January, 2013 WoW

1.6

Last
8074.8

Prev. day
0.0

MoM
0.5

YoY
6.0

$/tonne

Rs/kg

448.9

-0.5

1.2

1.2

11.6

Copper
Copper prices fell 0.2 percent in yesterdays session. Copper prices declined due to unfavourable economic data from the Euro region along with rise in the LME inventories. Strength in the DX in the later part of the day also exerted downside pressure on the copper prices. LME Copper inventories increased by 2.49 percent in yesterdays session and stood at 3,27,325 tonnes on Tuesday as against 3,19,400 tonnes on 07th January 2013. Prices of Copper on LME touched an intra-day low of $ 8040 per tonne and closed at $ 8074.75 /tonne on Tuesday. In the domestic markets MCX copper declined 0.5 percent tracing weakness in the international prices and appreciation in the Indian rupee. In the domestic markets prices of Copper on MCX touched an intra-day low of Rs. 448.3 per kg and closed at Rs. 448.9 per kg on Tuesday. Outlook In the intra-day, base metal prices are expected to trade with bearish note due to mixed global market sentiments along with strength in the DX. There is expectation that Chinese economy grew at a faster pace in the fourth quarter of 2012. This is expected to increase the demand for the base metals thereby restricting decline in the prices. In the domestic market, base metal prices on MCX are expected to trade with bearish note due to appreciation in the rupee. Technical Outlook
Unit MCX Copper Feb13 MCX Zinc Jan13 MCX Lead Jan 13 MCX Aluminum Jan13 MCX Nickel Jan 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for January 09, 2013 Support 446/444 109.8/109 125.5/126.5 111.9/111.2 952/947 Resistance 451/454 111.3/112 128.2/129 113/113.6 964/972

(3 month) MCX Aluminum (Jan13) LME Nickel (3 month) MCX Nickel (Jan13) LME Lead (3 month) MCX Lead (Jan13) LME Zinc (3 month) MCX Zinc (Jan13)
Source: Reuters

Rs /kg

112.6

-0.7

0.9

-0.4

3.9

$/tonne

17351.0

0.0

1.4

0.7

-6.6

Rs /kg

957.2

0.0

2.2

2.1

-3.2

$/tonne

2324.0

0.0

-0.2

4.6

14.8

Rs /kg

127.4

0.1

-0.3

5.7

22.8

$/tonne

2022.3

0.0

-2.4

-0.6

9.0

Rs /kg

110.5

-0.6

-0.8

0.6

12.9

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 8th January
327375 5206675 143490 1209800 308350

7th January
319400 5213525 142248 1212575 309675

Actual Change 7,975 -6,850 1,242 -2,775 -1,325

(%) Change 2.5 -0.1 0.9 -0.2 -0.4

Source: Reuters

Technical Chart MCX Copper

Source: Telequote

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Commodities Daily Report

Wednesday| January 09, 2013

International Commodities
Important Events for Today

Indicator Trade Balance German Industrial Production m/m Crude Oil Inventories 10-y Bond Auction

Country GBP EUR US US

Time (IST) 3:00 pm 4:30 pm 9:00 pm 11:30pm

Actual -

Forecast -9.1B 1.1% 0.9M -

Previous -9.5B -2.6% -11.1M 1.65|3.0

Impact Medium Medium Medium Medium

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