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Commodity Research Report 07 March 2016 Ways2Capital .pdf



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✍ MCX DAILY LEVELS
DAILY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

DATE

ALUMINIUM 31 MAR 2016 117.75 109.95 108.20 107.45 106.45 105.65 104.75 102.95
COPPER

29 APR 2016

S4

101.25

373

361

349

343

337

331

325

313

301

CRUDE OIL 18 MAR 2016 2673

2576

2479

2444

2382

2347

2285

2188

2091

GOLD

05 APR2016 31615 30988 30361 30055 29734 29428 29107 28480

27853

LEAD

31 MAR 2016 134.30 131.15 128.00 126.50 124.85 123.35 121.75 118.50

115.43

NATURAL 28 MAR 2016 122.00 118.45 114.80 113.45 111.25 109.85 107.65 104.00
GAS

100.45

NICKEL

31 MAR 2016

SILVER

05 MAY 2016 39035 38358 37681 37455 37004 36778 36327 35650

34973

ZINC

31 MAR 2016 128.50 126.85 125.25 124.32 123.55 122.65 121.95 120.25

118.65

691

667

643

635

619

610

595

571

547

✍ MCX WEEKLY LEVELS
WEEKLY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

ALUMINIUM 31 MAR 2016 125.00 119.30 113.55 110.00 107.85 104.35 102.00 96.35

S4

90.55

COPPER

29 APR 2016

410

384

358

348

332

322

306

280

254

CRUDE OIL

18 MAR
2016

2913

2726

2539

2474

2352

2287

2165

1978

1791

GOLD

05 APR2016 32505 31544 30583 30166 29622 29205 28661 27700

26739

LEAD

31 MAR 2016 146.20 138.60

100.60

NATURAL
GAS
NICKEL
SILVER
ZINC

131.

128

123.40 120.40 115.80 108.20

28 MAR 2016 149.60 137.70 125.80 118.90 113.90 107.00 102.00 90.10

78

31 MAR 2016

450

768

715

662

05 MAY 2016 41622 39975 38328
31 MAR 2016

138

133

644
3779

609

591

556

503

36681 36132 35035 33387

31740

127.80 125.65 122.25 120.05 116.75 111.10

105.65

WEEKLY MCX CALL

BUY CRUDEOIL MAR ABOVE 2450 TGT 2550 SL 2348
SELL LEAD MAR BELOW 122.50 TGT 120 SL 124.50

✍ FOREX DAILY LEVELS
DAILY

EXPIRY

R4

R3

DATE

R2

R1

PP

S1

S2

S3

S4

USDINR

29 MAR 2016 67.9 67.80
0

67.70

67.60

67.50

67.40

67.30

67.20

67.10

GBPINR

29 MAR 2016 96.1
0

96

95.90

95.80

95.70

95.60

95.50

95.40

95.30

EURINR

29 MAR 2016

74

73.90

73.80

73.70

73.60

73.50

73.40

73.30

JPYINR

29 MAR 2016 59.8 59.75
5

59.65

59.55

59.40

59.30

59.20

59.10

59

R2

R1

PP

S1

S2

S3

S4

74
.10

✍ FOREX WEEKLY LEVELS
DAILY

EXPIRY

R4

R3

DATE

USDINR

29 MAR 2016 68.4 68.20
0

68

67.80

67.60

67.40

67.20

67

66.80

GBPINR

29 MAR 2016 96.7 96.50
0

96.20

96

95.80

95.60

95.40

95.20

95

EURINR

29 MAR 2016 74.6 74.40
0

74.20

74

73.80

73.60

73.40

73.20

73

JPYINR

29 MAR 2016 60.2
0

59.80

59.60

59.40

59.20

59

58.80

58.60

60

WEEKLY FOREX CALL

BUY USDINR MAR ABOVE 67.70 TGT 68.30 SL 67
BUY EURINR MAR ABOVE 74 TGT 75 SL 73

✍ NCDEX DAILY LEVELS
DAILY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

619

614

609

607

604

602

599

594

589

DATE
SYOREFIDR

20 APR
2016

SYBEANIDR

20 APR
2016

3756 3712 3668

3645 3624 3601 3580 3536

3492

RMSEED

20 APR
2016

3980 3935 3890

3863 3845 3818 3800 3755

3710

JEERAUNJHA

20 APR
2016

CHANA

20 APR
2016

15525 15065 14605 14360 1414 1390 13685 13225
5
0
4417 4356 4295

4259 4234 4198 4173 4112

12765
4051

✍ NCDEX WEEKLY LEVELS
WEEKLY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

689

662

635

620

608

593

581

554

527

DATE
SYOREFIDR

20 APR
2016

SYBEANIDR

20 APR
2016

4064 3924 3784

3703 3644 3563 3504 3364

3224

RMSEED

20 APR
2016

4360 4196 4032

3934 3868 3770 3704 3540

3376

JEERAUNJHA

20 APR
2016

CHANA

20 APR
2016

15950 15330 14710 14415 1409 1379 13471 12850
0
5
4628 4488 4348

4286 4208 4146 4068 3928

WEEKLY NCDEX CALL
BUY CHANA APR ABOVE 4260 TGT 4350 SL 4150
BUY DHANIYA APR ABOVE 6700 TGT 6900 SL 6480

12230
3788

MCX - WEEKLY NEWS LETTERS
INTERNATIONAL NEWS


Bullion

Gold edged lower on Friday, but was not far off a 13-month peak reached in the prior session
when a weaker dollar and technical buying gave bullion its best day in two weeks. Investors are
eyeing crucial U.S. Non farm payrolls data due later in the day, where a strong reading for
February could stall further gains in the precious metal, now up nearly 19 percent this year and
among the top commodity performers. MCX Gold Apr is currently trading at `29730. It is
trading up by `114 points for the day. MCX Silver May is currently trading at `37110. It is
trading down by 384 points.
Gold gained more than two percent in the previous session on weak dollar and technical
buying. U.S service sector data, which reported slower growth than in the previous month and a
decline in employment in this sector for the first time in two years, weighed down the dollar.
Meanwhile, investors are keenly awaiting the outcome of key U.S non-farm payrolls data
which scheduled later in the day as a strong data could stall more gains in the commodity.
Anyhow, gold is one of the top performing commodities so far during the year, gaining more
than 19 percent since January. Worries over global economic growth, concerns over the health
of the banking sector, poor U.S fourth quarter earnings coupled with speculation that the U.S
Federal Reserve may not raise rates this year had also supported the sentiments. Gold is also
drawing support from flows into the exchange traded funds. The assets of the world’s largest
gold backed exchange traded fund the SPDR Gold Trust placed at its highest level last seen in
September 2014. Increased import to India, the second largest consumer of the yellow metal
supported the sentiments as well.

✍ Energy
Oil futures rose in Asian trade on Friday, buoyed by renewed optimism prices may have
bottomed out after official US data showed oil production fell to its lowest level since
November 2014. Brent futures nudged up 3 cents to $37.10 a barrel as of 0147 GMT after
settling 14 cents higher in the previous session. MCX Crude Oil Mar is trading at 2350.The
crude benchmark is set to end the week with a gain of more than 5%. US crude futures had
climbed 13 cents to $34.70 a barrel, after settling down 9 cents in the previous session. While
US crude inventories rose to a new record of 517.98 million barrels last week, output fell for a
sixth straight week to 9.08 million barrels a day, according to data from the US Department of
Energy's Energy Information Administration. Cuts in US production are providing price
support, but investors are also waiting for key US economic data later on Friday to give further
direction, said Ben Le Brun, market analyst at Sydney's Options X press."A lot of traders are
keeping their powder dry in front of non-farm payroll data - it's the number one (indicator) in
terms of crude consumers," he said.
Natural Gas futures shed more than 1 per cent during noon trade in the domestic market on
Friday as investors and speculators exited positions in the energy commodity as hefty storage
levels exacerbated concerns of oversupplies as the end of the winter heating season threatened

to curb demand for the fuel in the US, the world’s biggest consumer. US gas supplies fell by
only 48 billion cubic feet last week compared to a five-year average withdrawal of 137 billion
cubic feet, well below the 227 billion cubic feet drop a year ago and 117 billion cubic feet
decline a week ago, the EIA said on Thursday. At the MCX, Natural Gas futures for March
2016 contract is trading at Rs 110.10 per mmBtu, down by 1.43 per cent, after opening at Rs
111.20, against the previous closing price of Rs 111.70. It touched an intra-day low of 109.50.
(At 14:12 PM)



Base Metal

Copper futures advanced during evening trade in the domestic market on Friday as investors
and speculators booked fresh positions in the industrial metal amid a pickup in physical
demand for copper in the domestic spot market. Further, traders pinned their hopes on China,
the world’s biggest metals consumer, to announce more growth boosting measures when the
country’s leaders begin legislative meetings on Saturday, to help steer the economy from the
threat of a hard landing. A Chinese central bank official stressed that the country’s monetary
and currency policies will remain stable. At the MCX, Copper futures for April 2016 contract
were trading at Rs.334.30 per 1 kg, up by 0.95 per cent, after opening at Rs. 331.75, against the
previous closing price of Rs. 331.15. It touched the intra-day high of Rs. 336.50 (At 16:48 PM).
Zinc futures retreated during noon trade in the domestic market on Friday as investors and
speculators exited positions in the industrial metal amid weak physical demand for zinc in the
domestic spot market. Further, soft US data signaled sluggishness in the world’s biggest
economy, clouding the metal’s demand outlook. US services growth cooled in February as the
gauge fell to 53.4 from January’s 53.5, factory orders grew by a less than expected 1.6 per cent
in January while jobless claims climbed 6,000 to 278,000 last week. At the MCX, Zinc futures
for March 2016 contract is trading at Rs 123.55 per kg, down by 0.24 per cent after opening at
Rs 123.55, against the previous closing price of Rs 123.85. It touched the intra-day low of Rs
123.30. (At 12:31 PM).
Aluminum production in Venezuela continued to drop in 2015 though iron ore recovered
slightly, the Ministry of Industry said in its annual report, after a year of labor conflicts, timid
investment and a deep recession.London copper was targeting its largest weekly advance in
four months on Friday as renewed risk appetite fuelled support for commodities on hopes for
further monetary stimulus from China, and signs of a stronger economy in the United
States.Three-month copper on the London Metal Exchange climbed by 0.4 percent to $4,875 a
tonne, extending a 1.4 percent gain from the previous session.

✍ NCDEX - WEEKLY NEWS LETTERS
Union Budget 2016
Increased allocation for price stabilization fund in the budget 2016-17 will help to check prices
of essential commodities, especially of pulses. The ministry of consumer affairs has already
prepared an action plan for this purpose. More than 50,000 MT pulses have been procured from

the farmers by various Government AGENCIES at the market prices and decision to import
20,000 MT pulses has been taken. Total buffer stock of 1.50 lakh MT pulses is being created
and import of 6000 MT pulses has already been ordered. These efforts will certainly help to
keep prices under check, he asserted. Besides increase in price stabilization fund from Rs. 500
crore to Rs. 900 crore in the budget, the government has also allocated Rs. 500 crore to
promote pulses production during current fiscal year. The operation of the fund has also been
transferred to the Department of Consumer Affairs from Ministry of Agriculture for better
coordination and timely action. Regarding implementation of Food Security Act, by next
month, the Act will be rolled out in all the states expect Tamil Nadu. The process of
demystifying the Budget began some years ago, when the government would introduce new
duties or revise rates whenever the need arose. Take steel. Delhi first announced a 20 per cent
safeguard duty on hot-rolled coil in mid-September and then, much to the industry's relief,
introduced in February minimum import prices of $341 and $752 a tonne on 173 products.Why
should the government wait for the Budget when the debilitating impact of import surges on
domestic steel makers was already in evidence? The US administration's response to steel
imports from China and Russia, with dollops of subsidy proving hurtful to local industry, is
found to be much faster and effective than of either India or the European Union.
Finance Minister Arun Jaitley has only partly met the aluminum industry's demand by raising
the import duty on primary metal to 7.5 per cent from five per cent. The industry was hoping
for a uniform import duty of 10 per cent on primary aluminum and scrap, which will continue
to invite a small duty of 2.5 per cent. Even this small mercy was not expected, given the
observation in the Economic Survey that raising the customs duty to curb imports of the silvery
white metal might affect the "competitiveness of downstream sectors like power, transport and
construction". The Survey, however, acknowledged the local industry's capacity use is now
down to 50 per cent, against nearly 100 per cent in 2014-15. This has happened because the
share of aluminum imports in the country's use of the metal is up sharply to 56.5 per cent in
2015-16 from 39.8 per cent in 2011-12.
Unfortunately for the industry, the government overlooked the fact that in the country's import
of 1.563 million tonnes (mt) of aluminum in 2014-15, the share of scrap and waste was as
much as 860,000 tonnes. By leaving the aluminum scrap import duty unchanged, the
government has kept the door open for the large-scale imports, which converters are suspected
to be using to make electricity conductor lines. These should ideally be made from primary
aluminum to avoid power losses during transmission. The commerce ministry reportedly found
merit in the industry's demand for a uniform duty on scrap and primary metal. At the current
level of capacity use, the industry, which in recent years invested Rs 1.2 lakh crore to double
smelting capacity to 4.2 mt, will continue to face difficult times.Iron ore presented the
challenge of striking a balance between the demand for conservation of a finite resource by
steel makers and the compulsion to export fines, for which local demand is negligible, and lowgrade lump ore. The proposal to extinguish the export duty on iron ore fines, now at 10 per
cent, and a 30 per cent duty for lump ore with iron content below 58 per cent will not find
critics. Earlier, recognizing the regular plant closures, Delhi abolished the five per cent export
duty on iron ore pellets. India's iron ore exports were down to five mt last year from 127 mt in
2011-12.

Much was expected of the Budget for the highly stressed farm sector, which fell victim to poor
monsoon for consecutive years. The farm production growth rate was minus 0.2 per cent in
2014-15 and, this year, the growth forecast was a puny 1.1 per cent. The Survey, which
expressed concern over the falling contribution of agriculture and allied sectors to the country's
gross value added, gave sufficient hints that the Budget's principal focus would be the farm
sector and welfare of growers.With an ambitious target of doubling farmers' income in five
years, Jaitley has made an allocation of Rs 9 lakh crore for agriculture credit, set a target of
bringing 2.85 million hectares under irrigation to reduce crop output dependence on monsoon
behavior, expanded crop insurance coverage and proposed the launch of a unified agricultural
market. Hopefully, effective implementation of these targets will herald the beginning of a new
era for the farm sector.



Jeera

Jeera prices closed lower by 1.06 per cent on Thursday at the National Commodity &
Derivatives Exchange Limited (NCDEX) on account of a surge in the supply from the
producing regions in the midst of a decline in the export demand. At the NCDEX, Jeera futures
for March 2016 contract closed at Rs. 14,005 per quintal, down by 1.06 per cent, after opening
at Rs. 14,195 against the previous closing price of Rs. 14,155. It touched the intra-day low of
Rs. 13,920. Global output of Jeera is around 2.2 lakh MT per year, of which India produces
about 1.5 lakh MT per year.



Mustard seed

Mustard seed prices closed higher by 1.21 per cent on Thursday at the National Commodity &
Derivatives Exchange Limited (NCDEX) as a result of the decline in the supply for the
commodity in the major markets. At the NCDEX, mustard seed futures for April 2014 contract
closed at Rs. 3,859 per quintal, up by 1.21 per cent, after opening at Rs. 3,826 against the
previous closing price of Rs. 3,813. It touched the intra-day high of Rs. 3,874. India produces
5.5 million MT to7 million MT annually and about 0.15 million MT is retained for sowing and
direct consumption as seed which leaves about 4.8-5.1 million MT for crushing and extracting
oil.


Chana

Chana prices fell by 0.53% to Rs 4,137 per quintal in futures trade on Wednesday as
participants lightened their positions, triggered by ample stocks at spot market following an
improvement in supplies.At the National Commodity and Derivatives Exchange, chana for
delivery in April declined by Rs 22, or 0.53%, to Rs 4,137 per quintal, with an open interest of
32,140 lots.On similar lines, the commodity for delivery in far-month May moved down by Rs
22, or 0.52%, to Rs 4,212 per quintal in 13,420 lots.Fall in chana prices at futures trade to
adequate stocks positions in the physical market on the back of increased supplies after
government took steps to check rising prices.Meanwhile, about 1.23 lakh tonnes of pulses
seized from hoarders have been disposed-off in the open market so far to boost supply and
contain rising prices.

LEGAL DISCLAIMER
This Document has been prepared by Ways2Capital (A Division of High Brow Market
Research Investment Advisor Pvt Ltd). The information, analysis and estimates contained
herein are based on Ways2Capital Equity/Commodities Research assessment and have been
obtained from sources believed to be reliable. This document is meant for the use of the
intended recipient only. This document, at best, represents Ways2Capital Equity/Commodities
Research

opinion

and

is

meant

for

general

information

only.

Ways2Capital

Equity/Commodities Research, its directors, officers or employees shall not in any way to be
responsible for the contents stated herein. Ways2Capital Equity/Commodities Research
expressly disclaims any and all liabilities that may arise from information, errors or omissions
in this connection. This document is not to be considered as an offer to sell or a solicitation to
buy any securities or commodities.
All information, levels & recommendations provided above are given on the basis of technical
& fundamental research done by the panel of expert of Ways2Capital but we do not accept any
liability for errors of opinion. People surfing through the website have right to opt the product
services of their own choices.
Any investment in commodity market bears risk, company will not be liable for any loss done
on these recommendations. These levels do not necessarily indicate future price moment.
Company holds the right to alter the information without any further notice. Any browsing
through website means acceptance of disclaimer.


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