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Precious Metals Preview:

Download-Gold-PNGMCX Gold To Eye Local Retail Buying.

COMEX Gold tanked last week as sentiments remained stressed in commodities. Gold has moved lower amid sustained slide in equities and the break under $1900 per ounce is keeping buying limited now. Gold continues to behave like a risky asset, moving in tandem with equities. The US dollar index has surged above 94 mark to hit a two month high. Gold tested around two month low of $1851 per ounce following this. However, losses are also seen limited now as traders would be looking at some uptick in retail demand in India following the slide well under the watershed Rs 50K mark. MCX Gold futures ended around Rs 49600 per 10 grams. Festive season demand over coming weeks will be keenly eyed after the recent correction in prices.

Base Metals Preview:

download (16)MCX Copper At Two Week Low.

COMEX Copper tested around one month low of $2.91 per pound as equities slumped amid economic worries and a resurgence of Covid-19 cases in Europe. The metal edged up little thereafter. MCX Copper futures followed the global cues and ended at a two week low of Rs 516.60 per kg. The International Copper Study Group (ICSG) released preliminary data for June 2020 world copper supply and demand in its September 2020 Copper Bulletin. Preliminary data indicates that world copper mine production declined by 1% in the first half of 2020, with concentrate production declining by 1.2% and solvent extraction-electrowinning (SX-EW) falling by 0.4%.
World Copper mine production is estimated to have declined by 4% in April-May as these two months were the most affected by the COVID-19 related global lockdown that resulted in temporary mine shutdowns/reduced production levels. However, world mine production started to recover in May as lockdown measures eased and June output reached the same level as June 2019.
ICSG noted that world apparent refined copper usage remained essentially unchanged in the first half of 2020. The COVID-19 related global lockdown has had a significant negative impact on the world economy and subsequently on key copper end-use sectors. World ex-China refined copper usage is estimated to have declined by about 9%: among the biggest copper using regions, refined usage declined by 12% in Japan, 10% in the EU, 4.5% in the United States and by about 8% in Asia (Ex-China). Preliminary world refined copper balance in the first half of 2020 indicates an apparent deficit of 235,000 t.

Energy Preview:

imagesOil Likely To Track Equities After Recent Correction.

WTI Crude oil futures fell last week after breaking below $40 per barrel as equities remained weak and US dollar index stabilized around two month high. MCX Crude oil futures also fell under Rs 2900 per barrel before witnessing some buying and ended at Rs 2968 per barrel. The US Energy Information Administration (EIA) reported an oil inventory draw of 1.6 million barrels for the week to September 18 following a draw of 4.4 million barrels for the previous week. Crude stocks at the Cushing, Oklahoma, delivery hub for WTI Crude rose by 4,000 barrels in the last week, EIA said. US Crude production eased to 10.7 million barrels per day. Oil was somewhat supported by and managed to close just above $40 per barrel. Overall sentiments remain steady in oil. The OPEC+ production cuts and curtailments in the United States are set to help global inventories to continue drawing down for the rest of the year and most of next year, resulting in a relatively balanced market by the end of 2021, the US Energy Information Administration (EIA) said in a latest update. Good fund buying and a possible pullback in equities after recent tumble could also benefit oil.

Investment & Trading in securities market is always subjected to market risks, past performance is not a guarantee of future performance.

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