Indian Rupee Slips Back To Near Record Lows

The Indian rupee commenced lower on Wednesday, July 31, 2013 extending previous day decline as dollar firmed up against other currencies in overseas markets ahead of the US Fed concluding its policy meeting and a weak opening in the domestic equity market added further pressure on the domestic currency. Besides, heavy month-end demand for the US currency amid growth concerns also weighed on the local unit. The domestic currency opened weaker by 43 paise at Rs 60.91 to a dollar, edged up to a high of 60.83 before slumping back to a low of 61.21 so far during the day. In the spot currency market, the Indian unit was last seen trading at 61.02, down around 54 paise or 0.89% as compared to previous close at 60.48.Rupee fell below the key psychological level of 60 to the dollar to a three-week low on Tuesday, posting its biggest fall in a month, and wiping out all the gains notched up on central bank's recent liquidity tightening measures as RBI kept interest rates on hold and failed to announce any additional steps to defend the currency. Domestic benchmark indices slumped in early trade as most Asian stocks fell as investors remained caution ahead of the Federal Reserve's policy decision. Asian shares were flat on Wednesday and the dollar held onto some slight gains as market momentum stalled ahead of the outcome of the U.S. Federal Reserve policy meeting and release of U.S. GDP data. At the time of writing, the S&P BSE Sensex was down 190.13 points or 0.98% to 19.158.21 while the CNX Nifty was down 53.80 points or 0.93% to 5,701.25. The dollar struggled to extend modest overnight gains early in Asia on Wednesday as investors trod cautiously ahead of the outcome of the Federal Reserve policy review that could see the central bank drive home a dovish message. The euro steady above 1.32 to the dollar. The dollar index was around 81.80 levels. The dollar yen was at 98. Powered by Commodity Insights

Technical Comment For The Day: Copper

Copper recovered sharply and tested a one week high on the back of high liquidation of short positions. The open interest has dipped continuously in the last three sessions. The pickup in volumes to 71541 kgs, also justified that the rise in metal. MCX Copper August expiry contract closed at Rs 421.5 per kg, up 2.5%. Further rise of metal towards Rs 425 is highly likely in today's session. Earlier in the month, Copper has managed to test the resistance of Rs 425 but failed to surpass it. On LME, Copper was up by 1.6%, at $ 6920 per tonne. The next support for the contract is at $ 7000 per tonne.

Source by Commodity Insights

Maize Futures To Witness Stockiest Selling From Higher Levels

Selling is likely to continue in maize futures in the near term due to steady kharif sowing progress along with weak export demand of maize in international prices. The NCDEX futures settled flat in the last trading.

As per the latest release from Ministry of Agriculture, the total sowing acreage of maize as on 26th July 2013 reported at 71.10 lakh hectares against 57.15 lakh hectares in the same time last year. This is mainly due to strong sowing in Andhra Pradesh, Uttar Pradesh and Rajasthan. The fresh supplies of these states will start from mid-September.

Moreover, weakness in export demand due to low prices of maize in international market will also encourage some selling in futures market. The spot prices of Indian maize are being traded at $20-30 per tonne higher in international market.

The NCDEX September futures declined by almost Rs 2 per quintal in the last trading to close at Rs 1290 per quintal . The NCDEX futures added 11.85 % in open interest indicating fresh short position by traders. Technically, selling is likely to emerge from 1298-1302 levels while supports are likely at 1275-1280 levels in the near term.

Source by Commodity Insights

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Copper.........

The resistance of Rs 413 and Rs 414 per kg again proved too stiff for Copper to breach on Tuesday. The metal remained in green but managed to close with minor gains of 0.09% to Rs 411.2 per kg. The prices are likely to remain trading in the same manner as they did on Tuesday. The range of Rs 414 and Rs 409 is active at the moment in Copper. Open interest in the metal was down by 7786 contracts to 25834 contracts on 30 July 2013. However the volumes were up reaching 53437 kgs in the August contract. This indicates that traders tried to settled their respective short positions before the key decisions from US.

Source by Commodity Insights

Gold Slips As Dollar Moves Up Ahead Of Fed

Gold.........

Gold futures are trading lower in the Asia electronic session today as the US dollar moved up from its one-month low against the Japanese yen, as the Federal Reserve prepared to start a two-day monetary-policy meeting.

The ICE dollar index, a gauge of the greenback’s movement against six other major currencies, rose to 81.711, up from 81.663 late Monday in North America. The euro bought $1.3260, little changed from $1.3263, while the British pound fell to $1.5339 from $1.5349.

The ICE dollar index had lost more than 3% since hitting its most recent high on June 9. The pullback was spurred by speculation about when the Fed will begin tapering its bond purchases and by subsequent comments from Fed Chairman Ben Bernanke about interest rates staying low for an extended period.

An ounce of gold on the COMEX division of the New York Mercantile Exchange is trading down $1.3 at $ 1328.3. Yesterday, it rose $7.70, or 0.6%, to settle at $1,329.60 an ounce. The FOMC begins its two-day meeting on Tuesday, with its decision on monetary policy due Wednesday.

September silver futures are trading down 0.049 at $ 19.81 per ounce on Comex. Yesterday, it ended higher by 9 cents, or 0.5%, to $19.86 an ounce.

A packed week of updates for the market includes the first reading of second-quarter gross domestic product in the U.S., manufacturing data from major gold consumer China, and monetary-policy decisions from the European Central Bank and Bank of England.

MCX new benchmark October contract may open today’s session near Rs 27850 levels with support around Rs 27740 levels.

Source by Commodity Insights

Economic Buzz: Japan Industrial Output Falls 3.3 In June

Japan's industrial production took an unexpectedly sharp drop in June, falling a seasonally adjusted 3.3% from May, though manufacturers offered an upbeat outlook for the current month, the Ministry of Economy, Trade and Industry reported Tuesday. A fall in production of transport equipment, including autos, led the decline, followed by electronics and machinery, the ministry said. However, a survey of manufacturers raised their forecast for July's industrial production to a rapid gain of 6.5%, up from 3.3% projected in last month's survey. In May, the survey -- produced by the ministry -- had tipped output to fall 2.4% in June.

Source  by Commodity Insights

Economic Buzz: Japan's June Annual Retail Sales Rise 1.60%

The Ministry of Economy Trade and Industry said that retail sales rose to a seasonally adjusted annual rate of 1.6% in June, from 0.8% in the preceding month. Analysts had expected retail sales to rise at annual rate of to 1.9% last month.Source by Commodity Insights

Crude Oil Slips On Demand Concerns

Oil........

Crude oil futures slipped below $95 a barrel in the Asia electronic trades today on demand concerns from China after the official data released over the weekend showing profits at Chinese industrial firms slowed in June.

The Beijing-based National Bureau of Statistics said on Friday, that the net income increased 6.3 percent from a year earlier to 502.4 billion yuan ($82 billion), down from a 15.5 percent pace in May. Profit from main business operations fell 2.3 percent after an 8.8 percent gain the previous month, it said.

Industrial companies’ profits in the first six months of the year rose 11.1 percent to 2.58 trillion yuan, down from a 12.3 percent gain in the January-May period, and sales rose 11.4 percent to 47.8 trillion yuan.

In Asia today, the Hang Seng Index lost 1% and the Hang Seng China Enterprises Index skidded 1.8%. The Shanghai Composite dropped 1.4%, on course for a fourth straight day of losses. The Nikkei Stock Average fell 1.9% to 13,855.41, dropping below the 14,000-point level.

Light sweet crude futures for delivery in September are trading down 28 cents at $ 104.42 per barrel on the New York Mercantile Exchange. On the week, Nymex oil futures fell 3.24%.

In the week ahead, the U.S. is to publish data on gross domestic product and manufacturing activity to further gauge the strength of the U.S. economy. In addition, traders will be eyeing the Fed's monthly policy statement for indications on the future of the central bank's bond-buying program.

MCX August crude oil futures may open today’s session near Rs 6150 levels with support around Rs 6100-070 levels.

Source by Commodity Insights

Gold Extends Gains In Asia

Gold.......

Gold

futures extended gains in the Asia electronic session today, hitting an intraday high of $ 1340.5 per ounce. The metal also got some safe haven support from the losses in the Asian equities.

In Asia, the Japanese stocks tumbled toward a third straight day of losses on the yen’s strength, while Australian and South Korean shares climbed following overnight gains on Wall Street. Japan’s Nikkei Stock Average skidded 2.1%, and China’s Shanghai Composite lost 0.7%, after each also declined in the previous two sessions.

Gold for December delivery is trading up $9.1 at $ 1338.6 an ounce on the COMEX division of New York Mercantile Exchange. The august delivery contract which expired yesterday ended the session up $9.30, or 0.7%, to settle at $1,328.80 an ounce. Prices for the contract had tallied a two-session loss of 1.2%.

In the currencies today, the U.S. dollar came off one-months lows against the euro and the British pound Friday, but the greenback was still in line to post a loss of more than 1% for the week. The euro on Friday traded at $1.3281, down slightly from $1.3290 on Thursday, when it reached its strongest level since June 19. The dollar had advanced to ¥99.29 from ¥99.11 just after Japan’s Finance Ministry said the core consumer price index rose 0.4% from June 2012, though it was unchanged compared with May’s levels.

Investors later Friday will receive the final reading on U.S. consumer sentiment in July, with the survey expected to show a rise to 84 from a preliminary reading of 83.9. Late next week, attention will turn to the U.S. government’s key jobs report for July, with labor-market conditions a major component of the Fed’s assessment of economic recovery.

MCX August gold futures may open today’s session near Rs 27400 levels with resistance near Rs 27470-90 levels and support near Rs 27250 levels.

Source by Commodity Insights

Economic Buzz: Japan Registers Inflation For June

Japan's consumer prices managed to register mild inflation in June compared with a year earlier, data out Friday from the Finance Ministry showed. The core consumer price index, which excludes volatile fresh-food costs, rose 0.4% from June 2012, though it was unchanged compared to May's levels. Meanwhile, July's core CPI for metropolitan Tokyo -- seen as a leading indicator for the nation as a whole -- also scored a price gain, rising 0.3% on an annual basis, though it too was unchanged from the previous month. Overall national CPI including all items rose 0.2% from a year earlier, but was flat from May. The fuel, light and water charges segment led the gains, with a 5.7% annual increase nationally, the ministry said. Japan has been struggling to rid itself of on-and-off deflation that has dragged on the economy for years, with the central bank currently targeting a 2% core CPI gain by 2015.

Source by Commodity Insights

Oil Slips On Weak China Manufacturing

Oil........

Crude oil

futures slipped in tandem with the Asian equities after the China manufacturing activity slowed further in July.

NYMEX light sweet crude oil futures for September delivery are trading down 18 cents at $ 107.05 per barrel in the electronic trading. Yesterday, it ended up 29 cents, or 0.3%, to settle at $107.23 a barrel on the New York Mercantile Exchange.

Most major Asian markets retreated Wednesday after a gauge of Chinese manufacturing dropped to a 11-month low, with Japanese shares falling on a firmer yen and a pullback in the Standard & Poor’s 500 Index.

China’s Shanghai Composite lost 1.3%, extending losses as investors digested preliminary data released by HSBC, showing China’s manufacturing Purchasing Managers’ Index slid to 47.7 in July from a final reading of 48.2 in June.

On Tuesday, a Platts report showed a jump in China’s oil demand. China’s apparent oil demand climbed by 11.7% to average 9.99 million barrels per day according to a Platts analysis of Chinese government data released Tuesday. Apparent demand for oil in June was the highest since February 2011.

The American Petroleum Institute said supplies fell 1.4 million barrels for the week ended July 19. A Platts analyst survey showed a forecast for a 2.6 million-barrel decline. The API reported gasoline stockpiles down roughly 900,000 barrels and distillate supplies down by about 700,000 barrels.

MCX August crude oil futures may open today’s session near Rs 6370 levels with support near Rs 6340 levels.

Source  by Commodity Insights

Economic Buzz: China Manufacturing Gauge Hits 11-Month Low: HSBC

China's manufacturing-sector activity is slowing further in July, with new factory orders deteriorating at a faster pace, according to preliminary data out Wednesday from HSBC and Markit. The so-called flash version of HSBC's Chinese manufacturing Purchasing Managers' Index dropped to 47.7, an 11-month low and down from a final result of 48.2 for June, with any reading below 50 indicating contraction. A separate government version of the June PMI printed at 50.1. The flash PMI -- which includes about 85%-90% of the survey responses that will be used for the final version -- also showed new export orders slowing, albeit at a slower rate than in the previous month.

Source by Commodity Insights

Oil Steady Above $108 On China Move

Oil.....

Crude oil futures are trading steady above $108 an ounce in the Asia electronic session today buoyed by the China move in which it removed the lower limit on interest rates for banks, to help lenders attract more borrowers and spur economic activity.
The move by People's Bank of China, a key step in plans for liberalizing the country's interest rate regime, will remove a floor on lending rates set at 70% of benchmark lending levels set by the central bank. The move will reduce financing costs of domestic companies and improve the allocation of financial resources.
In Asia, Japan’s Nikkei Stock Average was flat at the midday break, while China’s Shanghai Composite slipped 0.3%, and Hong Kong’s Hang Seng Index gave up 0.2%. The performance in Tokyo came after the ruling Liberal Democratic Party’s coalition easily won a majority of the 121 seats contested in the upper house elections over the weekend.
Light sweet crude oil futures for September delivery are trading up 16 cents at $ 108.03 per barrel on the New York Mercantile Exchange. On the week, it advanced 2.1%, the fourth consecutive weekly gain. It has rallied nearly 14% over the past four weeks.
Appetite for riskier assets improved last week after Bernanke said in testimony to Congress that there was no set timeline for the central bank to withdraw its stimulus measures. Bernanke said the central bank could scale back its asset purchases by the end of the year if the economy continues to improve, but added that there was no “preset course.”
Oil prices were also supported after Wednesday’s bullish U.S. inventory report showed that crude oil inventories fell by 6.9 million barrels last week, compared to expectations for a decline of 2 million barrels. Crude supplies in the U.S. are down 27.1 million barrels in three weeks ended July 12, the most in weekly statistics dating back to 1982.
MCX August expiry crude oil futures may open today’s session near Rs 6440 levels with resistance near Rs 6470 levels.
In the week ahead, the U.S. is to publish data on the housing sector and manufacturing to further gauge the strength of the U.S. economy. Market players will also be looking ahead to Wednesday’s data on Chinese manufacturing activity, amid ongoing concerns over the country’s economic outlook.

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China Copper Concentrate Imports Rise In June

Copper.....
China reported a sharp rise in Copper concentrate imports for the month of June. Even on a half yearly basis, imports showed a sharp upswing. The data released from General Administration of Customs showed that China Copper concentrate imports were 673518 tonnes, up 40.23 percent in June, compared to same period last year. The total imports in the month of January-June 2013, was 4463111, up 32 percent.
On LME, benchmark prices were trading at $ 6981 per tonne, shy away from resistance of $ 7000 per tonne. MCX Copper August expiry was trading at Rs 416.6 per kg, up 0.5 percent.
Source by Commodity Insights

Gold Jumps Past $1300 On Dollar's Fall

Gold.......

Gold futures jumped past $1300 an ounce in the Asia electronic session today buoyed by losses in the US dollar. Gold continued to get boost from the comments by Federal Reserve Chairman Ben Bernanke earlier last week which eased concerns over the possibility the central bank will begin to taper its bond-buying program in the near future.
August dated gold futures contract is trading up $22 at $1315.4 an ounce on the Comex division of the New York Mercantile Exchange. On the week, gold prices advanced 0.85%, the second consecutive weekly gain. It may find support near $1255 levels and resistance near $1350-70 levels.
The U.S. dollar pulled lower against the yen on Monday following an election victory seen as empowering Japan’s prime minister to move forward with economic reforms in the world’s third-largest economy.
The dollar traded at ¥100.15, down from ¥100.60 on Friday but off an intraday low of ¥99.50. The ICE dollar index, which measures the greenback against six other major currencies including the yen, fell to 82.474 from 82.633 late Friday in North America.
In the first day of his semi-annual testimony to Congress, Bernanke reiterated that the Fed will continue to maintain its accommodative monetary policy for the foreseeable future. He added that the central bank may taper its USD85-billion-a-month asset-purchase program later this year and halt it around mid-2014.
Bernanke said the pace of purchases could be maintained longer if conditions are less favorable. The precious metal is on track to post a loss of 23% on the year amid concerns the Fed will start to unwind its stimulus program by the year's end.
Recently, Silver futures have been unable to pick up hit by the demand concerns. On Friday, Comex silver for September delivery eased up 0.4% to settle the week at $19.46 a troy ounce. Despite Friday’s modest gains, silver future prices lost 2.15% on the week.
Meanwhile, copper for September delivery rose 0.5% on Friday to close the week at $3.146 a pound. The red metal found support on Friday after China’s central bank said it was removing the lower limit on interest rates for banks, to help banks attract more borrowers. China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
MCX August gold may open today’s session near Rs 26770 levels with resistance near Rs 26840-900 levels.
In the week ahead, the U.S. is to publish data on the housing sector and manufacturing to further gauge the strength of the U.S. economy. Any improvement in U.S. economic activity could scale back expectations for further easing, boosting the dollar and weighing on gold.
Source by Commodity Insights

Technical Comment For the Day: Gold

Gold.......

MCX Gold settled at Rs 26347 per 10 grams, down Rs 122 per kg. The prices are very close to their 100 day EMA which is at Rs 26338 per 10 grams. The prices tested a high of Rs 26798 per 10 grams, while a low of Rs 26240 per 10 grams was tested. Fibonacci retracements set from Rs 28000, hit on 20 June 2013, show that a 38 percent retracement level is active at Rs 26040 per 10 grams. The volumes in the contract increased as the prices settled down. Total volumes were 33762 kgs on Wednesday, against 24948 a day before. However, International chart patterns suggest that COMEX Gold is well supported at $ 1270 per troy ounce. Gold can garner supports near Rs 26100-26200 per 10 grams.
TRADING STRATEGY: BUY Around Rs 26200-26250, TARGET 26600 SL 26120
Source by Commodity Insights

Gold Flattens Post Bernanke Comment

Gold.......

Gold futures are trading flat near $1278 an ounce in the Asia electronic session after Federal Reserve Chairman Ben Bernanke said there was no set timetable for slowing U.S. monetary stimulus.
Gold for August delivery are trading flat at $ 1277.5 an ounce after dropping $12.90 during Wednesday trade on the Comex division of the New York Mercantile Exchange. The undertone may remain weak today with the dollar appreciating against the single currency.
U.S. stocks ticked higher Wednesday after the Fed chairman said the central bank’s monthly bond purchases weren’t on a “pre-set course” and could be curbed or extended, depending on economic conditions.
Bernanke’s comments Wednesday came under scrutiny for clues as to when the Fed would reduce its bond purchases. Bernanke’s remarks also drove the dollar higher, with a rising U.S. currency weighing on dollar-denominated gold by making it more expensive to holders of euro, yen and other units.
The greenback extended those gains modestly in early Thursday trading, with the ICE dollar index rising to 82.751 from 82.715 late Wednesday.
The Fed chief was due to speak before the Senate later Thursday.
MCX August gold futures may open today’s session near Rs 26400 with resistance near Rs 26460 levels and support near Rs 26350 levels.
Source by Commodity Insights

Economic Buzz: U.S. June Industrial Production Up 0.3%

The U.S. Federal Reserve said that U.S industrials production increased 0.3 percent in June after having been unchanged in May. For the second quarter as a whole, industrial production moved up at an annual rate of 0.6 percent. In June, manufacturing production rose 0.3 percent following an increase of 0.2 percent in May. The output at mines advanced 0.8 percent in June, while the output of utilities decreased 0.1 percent. At 99.1 percent of its 2007 average, total industrial production was 2.0 percent above its year-earlier level. The rate of capacity utilization for total industry edged up 0.1 percentage point to 77.8 percent, a rate that was 0.1 percentage point above its level of a year earlier but 2.4 percentage points below its long-run (1972-2012) average.
Source by Commodity Insights

Economic Buzz: U.S Core CPI Eases In June

The Bureau of Labor Statistics said that U.S consumer prices, excluding food and energy costs, rose 0.2% in June, matching expectations. Core consumer prices inched up 0.2% in May. Core CPI increased at annualized rate of 1.6% last month, in line with forecasts and slowing from 1.7% in May.
Source by Commodity Insights

Economic Buzz: Chinese Growth Rate To Slip Under 7% This Year Says Official

China's economic growth rate will likely average 7% this year, Chinese Finance Minister Lou Jiwei said yesterday, according to media reports. This is much below the government's 7.5% target and would mark a slowing from 7.7% growth reported for the first quarter of this year. However, Lou also said the economy would not suffer a hard landing and that the slower growth was necessary for the reforms that the government is undertaking to further open up the economy and move away from dependence on exports. Despite the slowdown of China's economic growth rate, the structural reform is paying off. Source by Commodity Insights