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Commodity Research Report 14 November 2016 Ways2Capital .pdf



Original filename: Commodity Research Report 14 November 2016 Ways2Capital.pdf
Title: Commodity Research Report

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✍ MCX DAILY LEVELS
DAILY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

S4

ALUMINIUM

30-NOV-2016

118

116

114

112

112

110

110

108

106

COPPER

30-NOV-2016

329

324

319

316

314

311

309

304

299

CRUDE OIL

18-NOV-2016

3622

3535

3448

3393

3361

3306

3274

3187

3100

GOLD

05-DEC-2016

30409

30144

29879

29767

29614

29502

29349

29084

28819

LEAD

30-NOV-2016

141

138

135

134

132

131

129

126

123

NATURAL GAS

25-NOV-2015

241

234

227

222

220

215

213

206

199

NICKEL

30-NOV-2016

714

708

702

700

696

694

690

684

678

SILVER

05-DEC-2016

43652

43052

42452

42136

41852

41536

41252

40652

40052

ZINC

30-NOV-2016

156

154

152

151

150

149

148

146

144

R4

R3

R2

R1

PP

S1

S2

S3

S4

✍ MCX WEEKLY LEVELS
WEEKLY

EXPIRY

ALUMINIUM

30-NOV-2016

120

117

114

113

111

110

108

105

102

COPPER

30-NOV-2016

359

345

331

322

317

308

303

289

275

CRUDE OIL

15-NOV-2016

3836

3675

3514

3426

3353

3265

3192

3031

2870

GOLD

05-DEC-2016

30942

30517

30092

29874

29667

29449

29242

28817

28392

LEAD

30-NOV-2016

159

151

143

138

135

130

127

119

111

NATURALGAS

25-NOV-2015

263

248

233

225

218

210

203

188

173

NICKEL

30-NOV-2016

774

748

722

709

696

683

670

644

618

SILVER

05-DEC-2016

45025

44013

43001

42411

41989

41399

40977

39965

38953

ZINC

30-NOV-2016

178

169

160

155

151

146

142

133

124

Monday, 14 ]November 2016

WEEKLY MCX CALL
BUY ZINC NOV ABOVE 170 TGT 173 SL 167
BUY NATURAL GAS NOV ABOVE 183 TGT 192 SL 175
PREVIOUS WEEK CALL
BUY CRUDEOIL NOV ABOVE 3000 TGT 4000 SL 2994 - SL
✍ FOREX DAILY LEVELS
DAILY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

S3

USDINR

26-OCT2016

67.80

67.70

67.60

67.50

67.40

67.30

67.20

67.10

67

EURINR

26-OCT2016

73.80

73.70

73.60

73.50

73.40

73.30

73.20

73.10

73

GBPINR

26-OCT2016

85.60

85.50

85.40

85.30

85.20

85.10

85

84.90

84.80

JPYINR

26-OCT2016

63.70

63.60

63.50

63.40

63.30

63.20

63.10

63

62.90

R3

R2

R1

PP

DATE

S4

✍ FOREX WEEKLY LEVELS
DAILY

EXPIRY

R4

S1

S2

S3

USDINR

26-OCT2016

68.10

67.90 67.70

EURINR

26-OCT2016

74.10

GBPINR

26-OCT2016

JPYINR

26-OCT2016

67.50 67.30

67.10

66.90

66.70

66.50

73.90 73.70

73.50 73.30

73.10

72.90

72.70

72.50

85.90

85.70 85.50

85.30 85.10

84.90

84.70

84.50

84.30

64.10

63.90 63.70

63.50 63.30

63.10

62.90

62.70

62.50

WEEKLY FOREX CALL
BUY GBPINR NOV ABOVE 85 TGT 86 SL 84
BUY EURINR NOV ABOVE 63.60 TGT 64.40 SL 62.90
PREVIOUS WEEK CALL
BUY GBPINR NOV ABOVE 83.60 TGT 84.60 SL 82.80 - SL

S4

✍ NCDEX DAILY LEVELS
DAILY

EXPIRY

SYOREFIDR

20-DEC-2016

709

693

677

671

661

655

645

629

613

SYBEANIDR

20-DEC-2016

3197

3168

3139

3126

3110

3097

3081

3052

3023

RMSEED

20-DEC-2016

4694

4640

4586

4561

4532

4507

4478

4424

4370

JEERAUNJHA

20-DEC-2016

17618 17298 16978

16787

16658

16467

16338

16018

15698

GUARSEED10

20-DEC-2016

3806

3708

3610

3548

3512

3450

3414

3316

3218

TMC

20-DEC-2016

8043

7789

7535

7389

7281

7135

7027

6773

6519

R3

R2

S2

S3

S4

DATE

R4

R3

R2

R1

PP

S1

S2

S3

S4

✍ NCDEX WEEKLY LEVELS
WEEKLY

EXPIRY

R4

SYOREFIDR

20-DEC-2016

714

696

678

672

660

654

642

624

606

SYBEANIDR

20-DEC-2016

3538

3403

3268

3190

3133

3055

2998

2863

2728

RMSEED

20-DEC-2016

4951

4811

4671

4603

4531

4463

4391

4251

4111

JEERAUNJHA

20-DEC-2016

18285 17765 17245 16920 16725 16400

16205

15685

15165

GUARSEED10

20-DEC-2016

3989

3836

3683

3585

3530

3432

3377

3224

3071

TMC

20-DEC-2016

8843

8289

7735

7489

7181

6935

6627

6073

5519

DATE

R1

PP

S1

WEEKLY NCDEX CALL
BUY GUARSEED DEC ABOVE 3200 TGT 3300 SL 3100
BUY JEERA DEC ABOVE 16900 TGT 17400 SL 16494
PREVIOUS WEEK CALL
BUY GUARSEED DEC ABOVE 3370 TGT 3470 SL 3280 - NOT EXECUTED

MCX - WEEKLY NEWS LETTERS
✍ BULLION
Gold rose on Wednesday as the dollar steadied though analysts said the likelihood of higher U.S.
rates later this year was likely to keep prices under pressure, while oversupply pushed platinum to
its lowest since April. Spot platinum XPT= fell to $937.25 earlier, its lowest since touching $936.81
on April 6, before rising 0.1 percent to $ 946.20 an ounce at 1355 GMT. Spot gold XAU= was up
0.1 percent at $1,257.3 an ounce. Last week it fell to $1,241.20, its lowest since early June as
speculators cut bets on higher prices.U.S. gold futures GCcv1 was up 0.2 percent $1,258.4. Traders
were looking ahead to the minutes of the Federal Reserve's September policy meeting due at 1800
GMT. Higher U.S. rates could boost the U.S. currency which when it rises makes gold more
expensive for holders of other currencies. "We need the minutes to see what the thinking is on
timing, but it is clear the Fed will raise rates this year," Quantitative Commodity Research analyst
Peter Fertig said. "Today the dollar index appears to be steadying, that is a support, but the dollar is
generally stronger and that will weigh on precious metals." Analysts said investors who typically
buy gold as a hedge against political and financial uncertainty were shunning it and that was
reflected in holdings in physically backed exchange traded funds, which have plateaued overall this
week at above 57 million ounces. HLDTOTALL=XAU drying up of safe-haven demand, the risk of
profit-taking and the outlook for a stronger U.S. dollar suggest further pressure on prices. The U.S.
elections are the wild card to watch," Julius Baer analysts said in a note. "Our current view reflects
our base-case scenario of a Clinton presidency. The uncertainty coming with a Trump win is a
bullish element that however should be more than offset by the positive U.S. dollar impacts his
election would most likely come with."
Platinum and palladium have come under renewed pressure since the National Union of
Mineworkers signed a two-year wage agreement with Impala Platinum, effective July 1 to June
2018. "Both markets will register annual deficits for this year and next, but the high level of above
ground stocks means that there is no imminent physical tightness," Deutsche Bank said in a note.
are shunning platinum because they are not convinced stocks have shrunk enough to justify a return
to the market. Holdings of platinum-backed exchange traded funds fell this month to above 1.9
million tonnes, their lowest since mid 2013.

Gold prices edged lower on Friday as stocks firmed and the US dollar rose on expectations the
Federal Reserve would raise interest rates by the end of the year. Spot gold was down 0.1 per cent at
$1,256.50 an ounce by 0257 GMT. The metal was on track to end the week mostly flat. US gold
futures were steady at $1,257.90 an ounce. "People are happy to buy at these levels. But, there are a
lot of expectations of a Fed rate hike in December, which will be bearish for gold," said Ronald
Leung, chief dealer, Lee Cheong Gold Dealers in Hong Kong. There will also be some uncertainty

going into the elections, said Leung adding that if Democratic presidential candidate Hillary Clinton
wins over Republican Donald Trump then the dollar could strengthen and pull gold down. "Gold
looks a bit weaker on charts. We need to see if prices can hold at $1,240 levels ... then we would be
heading towards $1,260 and later to $1,275," he said. Spot gold may consolidate further in a narrow
range of $1,250-$1,266 per ounce for one day before falling to the October 7 low of $1,241.20,
according to Reuters technical analyst Wang Tao. Markets will next look to Friday's US retail sales
data and remarks from Fed Chair Janet Yellen, who will address a Boston Fed economics
conference at which Boston Fed governor Eric Rosengren will also speak. "We think its rate hiking
trajectory will remain very much intact," INTL FCStone analyst Edward Meir said in a note. "As a
result, the dollar will likely push higher going into year-end, offering gold its most formidable
headwind and even countering the impact of weaker equities." The dollar index, which measures the
greenback against a basket of six major currencies, gained 0.1 per cent to 97.612. Asian stocks
edged higher and the dollar bounced on Friday as global markets took a breather after being
churned by downbeat Chinese economic data the previous day. Global equity markets had slumped
to a three-month low on Thursday. Holdings of the SPDR Gold Trust, the world's largest goldbacked exchange-traded fund, rose 0.28 per cent to 961.57 tonnes on Thursday. Among other
precious metals, silver edged 0.3 per cent lower at $17.39 an ounce. The metal was on track for its
third consecutive weekly loss. Platinum was down for the fifth straight session as it fell 0.3 per cent
at $933.75 an ounce. The white metal is down over 3 per cent this week. Palladium shed 0.3 per
cent to $636. 10 after having touched a new three-month low of $633.22 an ounce. The metal is
down over 4 per cent this week

✍ ENERGY
Oil prices on Tuesday retreated from one-year highs, after OPEC said it was trying to reach a global
agreement to cap production for at least six months amid doubts about how much that would reduce
a crude glut. The International Energy Agency, the energy watchdog of the West, said it was unclear
how rapidly global oil supply could fall in line with demand even if the OPEC Countries and major
producer Russia agreed on a steep output cut. "Net, we find that an agreement to cut production,
while increasingly likely, remains premature given the high supply uncertainty in 2017," Goldman
Sachs said in a note. a deal would be "self-defeating if it were to target sustainably higher oil
prices," Goldman said. Oil has rallied than 13 percent in less than two weeks since OPEC proposed
its first production curbs in eight years. Still, prices remain about half of mid-2014 highs above
$100 a barrel. On Tuesday, Brent crude LCOc1 settled down 73 cents, or 1.4 percent, at $52.41 a
barrel, retreating from a one-year high of $53.73 hit on Monday. U.S. West Texas Intermediate
crude CLc1 fell 56 cents, or 1 percent, to settle at $50.79. Global oil industry officials in Istanbul
for the World Energy Conference issued a raft of statements on OPEC's production plan.

Oil prices fell on Thursday after OPEC said its production had risen to the highest level in at least
eight years and following reports of an increase in U.S. crude stockpiles. International Brent crude
oil futures LCOc1 were trading at $51.37 per barrel at 0256 GMT, down 44 cents, or 0.85 percent,
from their previous close. U.S. West Texas Intermediate crude futures were down 54 cents, or 1.08
percent, at $49.64 per barrel.Traders said oil markets had come under pressure after the
Organization of the Petroleum Exporting Countries reported a rise in output, despite the producer
cartel having plans, potentially with non-OPEC producer Russia, to cut output in a bid to rein in a
global supply overhang. "Crude responded predictably, with both Brent and WTI falling," said
Jeffrey Halley, senior market analyst at brokerage OANDA in Singapore. OPEC on Wednesday
reported its oil production climbed in September to the highest in at least eight years and raised its
forecast for 2017 non-OPEC supply growth, pointing to a larger surplus next year despite the
group's deal to cut output. The producer cartel pumped 33.39 million barrels per day last month,
according to figures OPEC collects from secondary sources, up 220,000 bpd from August. the
absence of any OPEC-Russia headlines to give crude its daily adrenaline shot, the market looks
nervously to the EIA Crude Inventory figures due in the U.S. this evening," Halley added. The U.S.
Energy Information Administration is due to publish official storage inventory data later on
Thursday. The American Petroleum Institute, a trade group, reported on Wednesday that U.S. crude
inventories rose by 2.7 million barrels to 470.9 million barrels in the week to Oct. 7. This would be
the first rise in oil stocks following five straight weeks of declines. softer gasoline consumption,
flagging demand from China and the return of refineries from maintenance will likely drive up
global stock levels over Q4," BMI Research said in a note,

✍ BASE METAL
Zinc futures fell by 0.30 per cent to Rs 150.45 per kg today as speculators indulged in reducing
positions amid a weak trend in base metals overseas and low spot demand. Zinc for delivery in
current month shed 45 paise or 0.30 per cent to Rs 150.45 per kg at the Multi Commodity
Exchange. It clocked a business turnover of 734 lots. The metal for delivery in November too fell
by a similar margin to trade at Rs 151.10 per kg in 23 lots. Analysts attributed the fall in zinc futures
to cutting down of bets by participants, tracking weakness in base metals pack at the London Metal
Exchange amid concerns over China's economy.
Nickel futures traded 1.34 per cent down at Rs 697.10 per kg on Thursday as speculators reduced
their exposure, tracking a weak trend in base metals at the London Metal Exchange amid muted
demand at the domestic spot markets. At the Multi Commodity Exchange, nickel for delivery this
month shed Rs 9.50 or 1.34 per cent to Rs 697.10 per kg in a business turnover of 2,451 lots.The
metal for delivery in November too fell by Rs 8.90 or 1.25 per cent to trade at Rs 703 per kg in 114
lots. Market analysts said the fall in nickel prices was mostly in tune with a weak trend in the base

metals pack at the LME as an unexpected drop in Chinese exports spurred concern about the
outlook for the global economy.China's exports plummeted 10.0 percent year-on-year to $184.5
billion in September, government data showed on Thursday.Besides, muted demand from alloymakers at the domestic spot markets weighed on metal prices in futures trade here.Globally, nickel
prices retreated by 1.6 per cent at the LME, reversing earlier gains.
Lead prices were down 0.29 per cent to Rs 135.50 per kg in futures trading today as participants
reduced their exposure, triggered by subdued demand from consuming industries in the spot market
and weak global cues. At the Multi Commodity Exchange, lead for delivery in November month
declined by 40 paise, or 0.29 per cent to Rs 135.50 per kg in business turnover of 24 lots. Likewise,
the metal for delivery in current month contracts shed 25 paise, or 0.19 per cent to Rs 134.85 per kg
in 483 lots.
Marketmen said the weakness in lead futures was due to a sluggish demand from battery-makers at
the domestic markets, apart from weak global cues after China's exports unexpectedly declined,
raising global demand outlook.
NCDEX - WEEKLY MARKET REVIEW
The recent rains in Gujarat and Rajasthan and lower stocks in international market have boosted the
prospects of jeera, the second largest exported spice from India. The near month jeera futures prices
in Ncdex hovered around Rs 163 per kg on Saturday. But the November and December futures
prices are showing a higher price trend. The export demand going through a sluggish phase
following reduced buying by China and Hanjin shipping company fiasco is expected to pick up in
the months. ``Indian cumin is priced $200 lower than the stock in Syria and Turkey at $2500 per
tonne but there are no takers with China going slow on purchase. The bankruptcy of Hanjin
shipping company also led to delay in shipments affecting exports,’’ said Dipak Parikh, partner of
Kanu Krishna Corporation. The political turmoil in Syria and the depletion of stocks in that country
and Turkey, which are the two major producers of cumin after India, could lead to a shift in demand
to India in the coming months, according to Religare Broking. The falling rupee is also expected to
benefit the Indian exports in the medium term. The cumin exports at 41,000 tonnes valued at Rs
637.50 crore for three months to June 2016 had shown 55% increase in quantity and 50% rise in
value from a year ago. increase in quantity and 50% rise in value from a year ago. ``The good rains
in Gujarat region are good for cumin, the sowing of which will commence this month. Since the
situation is not ideal for coriander, another spice cultivated in these regions, farmers may shift to
cumin,’’ said KrishnakumarMenon, head of procurement of Eastern Condiments Pvt. Ltd., a major
curry masala company.
✍ Sugar
Sugar price rally dents expectations for Chinese imports The rally in sugar prices, coupled with

improved domestic production prospects, has dented expectations for purchases of the sweetener by
China, the top importer. The US Department of Agriculture's Beijing bureau cut to 6.0m tonnes its
forecast for Chinese sugar imports in 2016- 17 – ditching expectations of a rise in volumes. Indeed,
the downgraded figure was 1.9m tonnes below the USDA's official estimate. The reduced import
estimate "is a result of both higher domestic sugar cane production, a narrowing of domestic and
global sugar price spreads which makes smuggling less attractive, as well as a strengthening of
Chinese enforcement against illegal sugar trade," the bureau said in a report. Sugar Rally, Normal
Monsoon Rain Seen Trimming India Imports India may import less sugar than predicted three
months ago after global prices surged to a four-year high and the first normal monsoon in three
years boosted the outlook for domestic crop. Overseas purchases may total 1.25 million metric tons
in the year starting Oct. 1, the most since 2009-10, according to the median estimate of six traders
and analysts surveyed by Bloomberg. That compares with 2.1 mt predicted in a June survey.
Production is seen tumbling 10 % to 22.5 mt, the median estimate of another survey of 10 traders
and analysts showed. The Indian Sugar Mills Association estimates supplies next year will be
enough to meet domestic demand forecast at about 25.6 million tons with inventory of 7.5 mt. The
group says production will drop 6.8 percent to 23.4 million tons in 2016-17. Stockpiles are
sufficient to meet demand and the domestic prices are stable over the past six months, the
FoodMinistry said in an e-mailed statement on Wednesday.
✍ Soybean
Soybean futures closed lower on week due to reports of new season soybean crop from MP,
Rajasthan and Maharashtra. The most-active Oct’16 delivery contract closed 0.31% down to settle
at Rs. 3,225 per quintal. As per Soybean Processors Association of India recent survey across
Madhya Pradesh, Maharashtra, and Rajasthan India's soybean production in 2016-17 Jul-Jun to 10.9
mt, up 58% from the last year. Soybean production is estimated higher in all the three states, which
account for over 80% of the country's output. U.S. soybean fell as U.S. farmers are expected to
boost the pace of harvesting on forecasts of dry weather in the Midwest. Moreover, Brazil's
CONAB forecast that 2016/17 soybean production in the country, a key exporter, will rise to
between 101.9 million and 104 mt from 95.4 mt in the previous marketing year. The USDA
reported weekly soybean export sales rose to 2.180 mt from 1.693 mt a week ago, well above
forecasts for 1.2 mt to 1.5 mt.
✍ Mustard Seed
Mustard seed futures closed lower last week due to lower demand and expected to higher
production in the next season. There is expectation of pickup in physical demand from the industrial
buyers. The Oct’16 contract ended 1.40% lower last week to settle at Rs. 4,507/quintal. The
country's production of rapeseed, is expected to rise 6.3 mt, up 12.5 % from a year earlier. The
demand for mustard may pickup in physical market due to approaching winter.There are reports of


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