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Commodity Research Report 28 September 2015 Ways2Capital .pdf



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✍ MCX DAILY LEVELS
DAILY

EXPIRY DATE R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

30 SEP 2015

30
SEP

108

107

106

104

103

102

102

100

COPPER

30 NOV 2015

30
NO

355

350

344

341

339

335

333

328

CRUDE OIL

21 SEP 2015

19 3303
OCT

3214

3125

3078

3036

2989

2947

2858

GOLD

05 OCT 2015

05 27320
OCT

27123

26926

26830

26729

26633

26532

26335

LEAD

30 SEP 2015

30
SEP

115

114

112

110

110

109

108

106

NATURAL GAS

25 SEP 2015

27
OCT

184

181

178

176

175

173

171

168

NICKEL

30 SEP 2015

30
SEP

681

673.07

664

660

655

651

646

637

SILVER

04 DEC 2015

04 37580
DEC

37068

36556

36314

36044

35802

35532

35020

ZINC

30 SEP 2015

30
SEP

113

110

108

107

106

105

102

115

✍ MCX WEEKLY LEVELS
WEEKLY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

30 SEP 2015

30
SEP

116

112

108

105

104

101

100

96

COPPER

30 NOV 2015

30
NOV

395

378

360

349

343

331

325

308

CRUDE OIL

21 SEP 2015
212015

19
OCT

3667

3454

3241

3136

3028

2923

2815

2602

GOLD

05 OCT 2015

05
OCT

29428

28509

27590

27162

26671

26243

25752

24833

LEAD

30 SEP 2015

30
SEP

121

117

114

111

110

108

107

103

NATURAL GAS

25 SEP 2015

27
OCT

187

183

179

177

175

173

171

167

NICKEL

30 SEP 2015

30
SEP

726

700

675

666

649

640

624

598

SILVER

04 DEC 2015

04
DEC

39536

38315

37094

36583

35873

35362

34652

33431

ZINC

30 SEP 2015

30
SEP

122

117

113

110

108

105

103

98

✍ NCDEX DAILY LEVELS
DAILY

EXPIRY
DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

SYOREFIDR

20 OCT 2015

611

600

589

584

578

573

567

556

545

SYBEANIDR

20 OCT 2015

3585

3490

3395

3352

3300

3257

3205

3110

3015

RMSEED

20 OCT 2015

4548

4457

4366

4329

4275

4238

4184

4093

4002

JEERAUNJHA

20 OCT 2015

16771 16521

16271

16143

16021 15893 15770 15521

15271

CHANA

20 OCT 2015

5005

4870

4735

4686

4600

4551

4465

4330

4195

CASTORSEED

20 OCT 2015

4325

4283

4241

4213

4199

4171

4157

4115

4073

✍ NCDEX WEEKLY LEVELS
WEEKLY

EXPIRY
DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

SYOREFIDR

20 OCT 2015

627

610

593

586

576

569

559

542

525

SYBEANIDR

20 OCT 2015

3734

3583

3432

3371

3281

3220

3130

2979

2828

RMSEED

20 OCT 2015

4647

4519

4391

4341

4263

4213

4135

4007

3879

JEERAUNJHA

20 OCT 2015

18308 17553

16798

16406

16043 15651 15288 14533

13778

CHANA

20 OCT 2015

5287

5046

4805

4721

4564

4480

4313

4082

3841

CASTORSEED

20 OCT 2015

4484

4387

4290

4238

4193

4141

4096

3999

3902

MCX - WEEKLY NEWS LETTERS
INTERNATIONAL NEWS

PRECIOUS METAL
✍ GOLD
Gold continued to witness a massive sell off. The yellow metal settled at its lowest price this
year, nearing the $1200 per ounce mark and logged its third straight weekly decline. Other
precious metals also dropped heavily amid soaring equities and continued strength in the US
dollar. Silver tumbled to a four year low, Platinum fell to a fresh 2014 lows while palladium
slumped to a three-month low. Gold fell as the US dollar rallied post the Fed decision where it
noted that that there is sufficient underlying strength in the broader economy to support
ongoing improvement in labor market conditions.
The FOMC noted that it currently judges that there is sufficient underlying strength in the
broader economy to support ongoing improvement in labor market conditions. In light of the
cumulative progress toward maximum employment and the improvement in the outlook for
labor market conditions since the inception of the current asset purchase program, the
Committee decided to make a further measured reduction in the pace of its asset
purchases.However, the Fed reassured that a key interest rate will stay near zero for a
considerable time after its bond purchases end next month, deferring for now a clear signal on
when it will begin to shift away from low-rate policies in place since the 2008 financial crisis.
The US dollar broke under 1.2900 mark against the Euro after the Fed statement, testing its
highest level against the Euro in 14 months. Dollar also cruised to a six year high against the
Japanese Yen and the broad dollar index hit a fresh 15 month high.
Demand worries continue to dominate sentiments for gold. China`s gold imports from Hong
Kong in July fell by 42% from a month earlier, according to the Hong Kong Census and
Statistics Department, media reports quoted. As per the latest Gold Demand Trends report
released by World Gold Council, world gold demand for Q2 2014 was 964 tonnes, down
16%year on year from 1,148 tonnes, central bank purchases rose 28 % year on year, to 118
tonnes from 92 tonnes, total bar and coin demand fell by 56% year on year to 275 tonnes from
628 tonnes, ETF outflows were 40 tonnes, a tenth of the outflows seen in the same period last
year.
Gold rose to a two-month peak on Tuesday as equity market, Iraqi insurgency, Weaker Dollar,
and soft German business sentiment data and Softer US Data helped bullion build gains. There
was a heavy slate of U.S. economic data released Tuesday, including the S&P/Case-Shiller
home price index, the monthly house price index, new residential sales, the Richmond Fed
business survey, and the consumer confidence index. However, these reports were not big
markets-movers. The yellow metal climbed as investors switched out of equities after
Germany's Ifo index of business sentiment fell more than expected in June. The German Ifo
consumer sentiment survey came in weaker than expected. The Ifo reading was 109.7 in June
versus 110.4 in May. A figure of 110.2 was expected. Worries about the Iraq and Ukraine crisis

weighed on German consumer sentiment. The downbeat Ifo report adds more weight to the
notions that the European Union’s economy remains in serious trouble. This is also an
underlying supportive factor for the safe-haven gold market. August Comex gold was last up
$1.20 at $1,319.60 an ounce. Spot gold was last quoted up $1.20 at $1,320.00. July Comex
silver last traded up $0.135 at $21.15 an ounce.
In total, 30 companies reduced their delta-adjusted hedge books during the period. This activity
was only partially countered by new hedges from other gold miners. Also, little new hedging
activity has been reported to have taken place since the end of June. After a brief recovery
during the first week of April, gold failed to break above $1220 an oz as the Fed hinted of a
June rate hike the following week. Speculation rose marginally amongst money managers, but
as cumulative turnover of COMEX gold futures remained subdued, gold came under pressure
causing it to trade range bound between $1190 an oz and $1220 an oz. During the first week of
July, gold struggled to close above $1170 an oz despite worries Greece would leave the Euro
zone. Weak safe-haven bids carried into the second week as fears failed to spillover the US
equity market. Over this period, the S&P500 held above a 4-month low, damping gold
volatility, the report said.

BASE METALS
London copper futures were flat on Tuesday after three days of gains, coming under pressure
from renewed signs of economic weakness in Europe but offset by encouraging global growth
prospects elsewhere. On Tuesday, the US Consumer Confidence Index rose to 85.2 in June, the
highest since January 2008, and new home sales for May also hit a six-month high of 504,000,
well above the 440,000 expected. Notably, the upbeat housing data were largely contributed by
sharp increase in sales in northeast US. In the euro zone, however, Germany's Ifo index of
business sentiment fell to its lowest this year, leaving trading subdued. Nickel fell to a
one-week low in London as rising stockpiles signaled ample supplies. Inventories monitored by
the London Metal Exchange rose 0.3 percent to 305,388 metric tons, within 0.2 percent of an
all-time high reached last week. Three-month copper on the London Metal Exchange was to
$6,885($3.12 a pound) a tonne by 0915 GMT from $6,885 at the close on Monday, its highest
close in three weeks. On the Comex in New York, copper futures for delivery in September
gained 0.1 percent to $3.145 a pound. Nickel for delivery in three months fell 1.6 percent to
settle at $18,130 a ton at 5:50 p.m. on the LME, after reaching $18,096, the lowest since June
16.
Copper prices rose by 0.28 per cent on Thursday after Japan’s all industries activity index rose
more-than-expected last month signaling improving sentiment in the region which raised the
demand for the metal. In a report, Japanese Ministry of Economy, Trade and Industry said that
Japan’s All Industries Activity Index rose to a seasonally adjusted 0.2 per cent, from 0.5 per
cent in the preceding month whose figure was revised up from 0.3 per cent. At the MCX,
copper futures for November 2015 contract were trading at Rs.341.10 per 1 kg, up by 0.28 per
cent, after opening at Rs. 341.10 against the previous closing price of Rs. 340.15. It touched the
intraday high of Rs. 341.70 till the trading.

✍ NICKEL
Nickel prices gained 0.74% to Rs 639.50 per kg in futures market today as traders enlarged
positions amid a firming trend in the spot market on increased demand from alloy makers.
However, a weak trend in select base metals overseas capped the gains. At the Multi
Commodity Exchange, nickel for delivery this month gained Rs 4.70, or 0.74%, to Rs 639.50
per kg in a business turnover of 888 lots.Similarly, the metal for delivery in October rose by Rs
5.30, or 0.70%, to Rs 646 per kg in 61 lots. Analysts said besides rising demand from alloy
makers at domestic spot markets, covering-up of short positions by speculators also influenced
nickel futures here.

✍ LEAD
Lead prices weakened by 0.46% to Rs 111 per kg in futures trading today as participants
reduced their exposures. Furthermore, sluggish demand from battery makers in the spot market
weighed on prices. At the Multi Commodity exchange, lead for delivery in October eased by 45
paise, or 0.46%, to Rs 111 per kg in a business turnover of 17 lots.
The metal for delivery in current month shed 35 paise, or 0.32%, to Rs 110 per kg in 485 lots .
Market analysts said besides sluggish demand from battery makers in the spot market, a weak
trend in copper and other base metals was seen at the London Metal Exchange (LME) after a
private gauge of manufacturing in China for September fell to the lowest since March 2009. At
the LME, lead declined 1%.

✍ ZINC
Zinc futures rose by 1.34 per cent to Rs 109.50 per kg in futures trade today due to the decline
in the zinc stockpiles at the London Metal Exchange (LME) on account of the strong demand
for the commodity. LME zinc stocks fell by 2200 metric tonnes to 597000 metric tonnes as on
September 24, 2015. Zinc futures for September 2015 contract, at MCX, were trading at Rs
109.50 per kg, up by 1.34 per cent after opening at Rs. 109.60 against the previous closing
price of Rs. 108.05. It touched the intraday high of Rs.109.95 till the trading. (At 4.15 PM
today). Sentiment improved further as speculators increased positions in the midst of a strong
nd overseas. Besides, high demand in domestic spot markets fulled the uptrend.

✍ ENERGY
West Texas Intermediate oil futures ticked higher on Tuesday, after the Wall Street Journal said
the Obama administration has cleared the way for exports of a type of ultra-light U.S. oil called
condensate. The U.S. Commerce Department has approved plans by two companies, Pioneer
Natural Resources Co and Enterprise Product Partners LP, to export condensate in a private
ruling, the Wall Street Journal reported on Tuesday. U.S. crude inventories rose by 4 million

barrels to 382.6 million barrels in the week to June 20, while gasoline stocks also climbed data
from industry group the American Petroleum Institute showed on Tuesday. Analysts had
expected a decrease in crude inventories of 1.6 million barrels, according to a Reuter’s poll.
OPEC's commercial oil stocks stand at 57.5 days of forward demand, OPEC Secretary General
Abdullah al-Badri said on Tuesday, adding there was no shortage of oil in market. Top oil
exporter Saudi Arabia would increase crude oil production to meet demand if there are
disruptions in oil supplies, a Saudi oil official said on Tuesday. Saudi Arabia, which currently
produces around 9.7 million barrels per day (bpd), has the ability to pump to its full capacity of
12.5 million bpd, the official told Reuters. WTI for August delivery climbed as much as $1.47
to $107.50 a barrel in electronic trading on the New York Mercantile Exchange and was at
$106.95 at 10:02 a.m. Sydney time. Brent for August settlement slipped 42 cents, or 0.4
percent, to $114.04 a barrel on the London-based ICE Futures Europe exchange. The European
benchmark crude traded at a premium of $7.29 to WTI from $8.43 yesterday.
Crude oil futures edged higher by Rs 3 to Rs 3,045 per barrel today as speculators went about
creating positions amid a firm trend overseas. In futures trading at the Multi Commodity
Exchange, crude oil for delivery in November was up by Rs 3, or 0.10%, at Rs 3,045 per barrel,
with a business turnover of 122 lots. The oil for delivery in October gained Rs 2, or 0.07%, to
Rs 2,985 per barrel in a turnover of 2,443 lots. Analysts said the rise in crude oil futures was
largely in tandem with a firming trend in Asia after taking a hit in the previous session in
response to a mixed US stock report. Meanwhile, West Texas Intermediate crude prices rose
$44.88 while Brent added $0.67% to $48.07 per barrel at the New York Mercantile Exchange.

✍ NCDEX - WEEKLY NEWS LETTERS
With the Securities and Exchange Board of India (Sebi) set to regulate commodity derivatives
from Monday, it is considering strengthening the norms relating to risk management for
agricultural commodities derivatives, which account for a fifth of the overall volumes.The
regulator has identified various focus areas, including exchanges playing a bigger role in
settlement and delivery, forward trading, spot exchanges and special delivery-based
settlements.
All commodity exchanges shall ensure guarantee for the settlement of trades, including good
delivery. It wants exchanges to become the central counterparty to all deals and guarantee
settlements. This is possible when exchanges set up clearing corporations, for which the
regulator has given them three years.For agri commodities, exchanges ensure good delivery and
settlement but aren’t the central counterparty because of several government norms such as
stock limits, as well as quality issues. The National Commodity & Derivatives Exchange
(NCDEX), the market leader in agri commodities trading, has a subsidiary called NCDEX
e-Markets, earlier known as the NCDEX Spot Exchange.
NCDEX e-Markets isn’t a spot exchange; it is an auction platform or a service provider. Both
equity exchanges have subsidiaries that offer similar services and should be viewed in that

context. Government enterprises also use the services of such platforms to procure
commodities for market operations.
Another issue Sebi is understood to have raised is the forwards segment launched by NCDEX
and the National Multi-Commodity Exchange of India. In the forwards segments, there are no
standardised contracts; buyers and sellers report deals on the exchange’s platform. In case of a
default, the loss to other party is made good by paying 90 per cent of the margin collected. Sebi
has sought the exchange be made the central counterparty in this case.In the equity derivatives
segment, lot sizes have been increased to ensure small investors stay away. The regulator is
thinking of taking similar measures for commodity derivatives, too. If that is done, mini
contracts of commodities might lose attractiveness, as their size will increase. Some contracts
are providing good liquidity and participation from small traders.

✍ CHANA
Chana prices fell by 0.86 per cent to Rs 4,521 per quintal in futures trade on monday as
participants trimmed positions, triggered by easing demand at prevailing levels in the spot
market against adequate stocks.At the National Commodity and Derivative Exchange, chana
for delivery in October fell Rs 39, or 0.86 per cent, to Rs 4,521 per quintal with an open interest
of 75,000 lots
Likewise, the commodity for delivery in November shed Rs 4, or 0.09 per cent, to Rs 4,551 per
quintal in 56,870 lots.Offloading of positions by speculators, driven by weak cues from spot
market on easing demand against adequate stocks position, mainly led to fall in chana prices in
futures trade.

✍ JEERA
Jeera futures moved up as traders covered position following tight supply in producing states.
Moreover, expectation of fresh export demand too pushed up jeera price in spot. Jeera futures
surged due to limited stocks in local mandies coupled with weak monsoon rainfall in major
producing states. At the unjha mandi of Gujarat, arrival of the spice was reported at 2,000 bags
and price was up by 30 to 2,200-3,200 per 20 kg. About 300 bags arrived in Rajkot APMC and
price increased by 25 to 2,450-3,100. On the NCDEX, jeera October contract gained 115 to
16,050 a quintal.

✍ RM SEED
Mustard Seed prices closed lower by 0.14 per cent on Tuesday at the National Commodity &
Derivatives Exchange Limited (NCDEX) as a result of the profit booking by the traders on
account of the weak crushing and export demand of mustard meal. At the NCDEX, Mustard
Seed futures for October 2015 contract closed at Rs. 4,226 per quintal, down by 0.14 per cent,
after opening at Rs. 4,225 against the previous closing price of Rs. 4,232. It touched the

intraday low of Rs. 4,214. Sentiment weakened further due to the sluggish export demand as a
result of the weak demand for the commodity.

✍ CASTORSEED
Castor seed prices fell by 0.64 per cent on Tuesday at the National Commodity & Derivatives
Exchange Limited (NCDEX) as a result of fresh supply of the commodity in the major mandies
as well as strong production estimates. At the NCDEX, castor seed futures for October 2014
contract was trading at Rs. 4,214 per quintal tonnes, down by 0.64 per cent, after opening at Rs.
4,245 against the previous closing price of Rs. 4,241. It touched the intraday low of Rs. 4,190
till the trading. (At 12.40 PM today). Castor oil, extracted from castor seed is the largest
vegetable oil exported out of India.

✍ SOYABEAN
Chinese leaders pledged to buy 13.18 million metric tons of U.S. soybeans or about 484 million
bushels in deals that represent about $5.3 billion.Iowa farmers are expected to harvest 525.8
million bushels of soybeans this year, about 4 percent more than 2014. It would be Iowa's
largest soybean crop, making the state the nation's second-largest soybean producer. Altogether,
U.S. farmers will harvest 3.94 billion bushels of soybeans.The size of Thursday's deals was
larger than expected and represents about half of China's annual purchases. The Chinese deals
comes at a critical time, say experts, shoring up demand for a bin-busting harvest at the same
time concerns grow over weakening economies in China and Europe.
"This business is valuable to the U.S. soy industry, especially when another bumper is being
harvested right around the corner.It probably won't spur prices higher. Even though it's a big
buy, it's not that big from China


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