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