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Daily Commodity Roundup as on Monday, November 19, 2018
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 1
14.38CRUDE $
56.68
-0.03 -0.06 0.00
IN
TER
NA
TIO
NA
L M
AR
KET U
PD
ATE GOLD $
1220.99SILVER $
USDJPY112.672
-0.1 0.06 -0.12EURUSD
1.1407GBPUSD
1.28357
LME
NICKEL
11240
-0.61 -0.46 -1.36
LME
COPPER
6205 LME
ZINC
2605
$ INDEX96.47
-0.03 -0.35 -0.65
LME ALUMINIUM
1947 LME
LEAD
1988
DJIA25289
0.56 0.62 0.83SENSEX
35457NIFTY
10682
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 2
NIKKEI21755
-0.08 1.06 0.35USDINR
71.99 S&P
INDEX
2730
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MCX Gold Dec 2018
Gold rallied as the dollar fell after U.S. Federal Reserve officials made cautions comments on the outlook for interest rate hikes.
Gold on MCX settled up 0.6% at 31007 as the dollar fell after U.S. Federal
Reserve officials made cautions comments on the outlook for interest rate
hikes. Two Fed officials cautioned that global economic growth was
slowing. Federal Reserve policymakers signalled further interest rate
increases ahead, even as they raised relatively muted concerns over a
potential global slowdown that has markets betting heavily that the rate-
hike cycle will soon peter out. U.S. manufacturing output increased for a
fifth straight month in October, shrugging off a sharp decline in motor
vehicle production and suggesting underlying strength in factory activity
despite signs of a slowdown in the sector. The Federal Reserve said
manufacturing production rose 0.3 percent last month. Data for
September was revised up to show output at factories increasing 0.3
percent instead of advancing 0.2 percent as previously reported. Brexit
fears took centre stage after UK Brexit Minister Dominic Raab resigned,
adding to uncertainty over whether Prime Minister Theresa May's
proposed Brexit deal will win parliamentary approval. Gold is trading at
premium in India for the first time in more than two months on robust
demand following a busy festival week, while a dip in global prices helped
bullion's appeal in some Asian hubs. Dealers in India, the world's second
biggest gold consumer after China, were charging a premium – the first
time since early September – of up to $3 an ounce over official domestic
prices in the week. Technically market is under fresh buying as market
has witnessed gain in open interest by 4.04% to settled at 9173 while
prices up 186 rupees, now Gold is getting support at 30829 and below
same could see a test of 30651 level, And resistance is now likely to be
seen at 31166, a move above could see prices testing 31325.
OPEN HIGH LOW CLOSE % CHANGE OPEN INTEREST
30845
SUPPORT 3
31503 31325 31166 30829 30651 30492
31147 30810 31007 0.60 9173
RESIST 3 RESIST 2 RESIST 1 SUPPORT 1 SUPPORT 2
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 3
Trading Ideas :Gold trading range for the day is 30651-31325.
Fed's Clarida says he sees some evidence of global economic slowing that's relevant to US outlook
Brexiters expect no confidence vote threshold in PM May will be reached today with the vote to take place on Tuesday
Gold is trading at premium in India for the first time in more than two months on robust demand following a busy festival week.
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MCX Silver Dec 2018
Silver prices rose as investors moved to risk-averse assets amid Brexit turmoil and trade war concerns.
Silver on MCX settled up 0.82% at 36991 as investors sought safe haven
assets amid fears of a chaotic departure for Britain from the European
Union. Prime Minister Theresa May vowed to fight for her draft divorce
deal with the EU after the resignation of her Brexit secretary and other
ministers put her strategy and her job in peril. A “really strong” U.S.
economy is likely to continue growing, but softness in housing and high
levels of corporate debt have caught the Federal Reserve’s eye, Chairman
Jerome Powell said. U.S. retail sales rebounded sharply in October as
purchases of motor vehicles and building materials surged, but data for
the prior two months was revised lower and the underlying trend
suggested that consumer spending was probably slowing down. The U.S.
economy is expanding at a 2.8 percent annualized rate in the fourth
quarter, based on domestic retail sales data in October, the Atlanta Fed’s
GDPNow forecast model showed. China’s written response to U.S.
demands for trade reforms is unlikely to trigger a breakthrough at talks
between Presidents Donald Trump and Xi Jinping later this month, a
senior Trump administration official told. Italy’s government is looking to
avoid European sanctions over its 2019 budget, Deputy Prime Minister
Luigi Di Maio said while stressing he did not want Italians to have to foot
the bill. Technically market is under short covering as market has
witnessed drop in open interest by -4.31% to settled at 26059 while
prices up 300 rupees, now Silver is getting support at 36729 and below
same could see a test of 36467 level, And resistance is now likely to be
seen at 37204, a move above could see prices testing 37417.
OPEN HIGH LOW CLOSE % CHANGE OPEN INTEREST
36797 37155
37679 37417 37204 36729 36467 36254
36680 36991 0.82 26059
RESIST 3 RESIST 2 RESIST 1 SUPPORT 1 SUPPORT 2 SUPPORT 3
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 4
Trading Ideas :Silver trading range for the day is 36467-37417.
U.S. manufacturing production rises steadily in October
Prime Minister Theresa May vowed to fight for her draft divorce deal with the EU after the resignation of her Brexit secretary.
The U.S. economy is expanding at a 2.8 percent annualized rate in the fourth quarter, based on domestic retail sales data in October.
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MCX Crudeoil Dec 2018
Crude oil prices remained supported by expected supply cuts from OPEC but held back by record U.S. production.
Crudeoil on MCX settled up 0.12% at 4109 supported by expected supply
cuts from OPEC but held back by record U.S. production. Prices were
mainly supported by expectations the Organization of the Petroleum
Exporting Countries (OPEC) would start withholding supply soon, fearing a
renewed rout such as in 2014 when prices crashed under the weight of
oversupply. U.S. crude oil production has hit a fresh record of 11.7 million
barrels per day, that's resulted in swelling commercial crude inventories.
While OPEC considers withholding supply, U.S. crude oil production
reached another record last week, at 11.7 million barrels per day (bpd),
according to U.S. Energy Information Administration (EIA) data. U.S.
output has surged by almost a quarter since the start of the year. The
record output meant U.S. crude oil stocks posted the biggest weekly build
in nearly two years. Crude inventories soared 10.3 million barrels in the
week to Nov. 9 to 442.1 million barrels, the highest level since early
December 2017. This surge contributed to oil prices falling by around a
quarter since early October, taking many by surprise. The Saudis have
the power to rescue this market. They went from announcing a million
barrels in cuts initially to 1.4 million barrels over a matter days. There's
the stirrings of a reaction coming and no one wants to be caught on the
wrong side. Technically market is under fresh buying as market has
witnessed gain in open interest by 94.82% to settled at 13059 while
prices up 5 rupees, now Crudeoil is getting support at 4039 and below
same could see a test of 3969 level, And resistance is now likely to be
seen at 4192, a move above could see prices testing 4275.
OPEN HIGH LOW CLOSE % CHANGE OPEN INTEREST
4119 4205
4345 4275 4192 4039 3969 3886
4052 4109 0.12 13059
RESIST 3 RESIST 2 RESIST 1 SUPPORT 1 SUPPORT 2 SUPPORT 3
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 5
Trading Ideas :Crudeoil trading range for the day is 3969-4275.
Prices were mainly supported by expectations the OPEC would start withholding supply soon, fearing a renewed rout such as in 2014 when prices crashed.
U.S. crude oil production has hit a fresh record of 11.7 million barrels per day, that's resulted in swelling commercial crude inventories.
Crude inventories soared 10.3 million barrels in the week to Nov. 9 to 442.1 million barrels, the highest level since early December 2017.
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MCX Copper Nov 2018
Copper gained after a Trump administration official told the list of items that China said it was not willing to negotiate was unacceptable to the United States.
Copper on MCX settled up 1.43% at 442.9 after a Trump administration
official told the list of items that China said it was not willing to negotiate
was unacceptable to the United States. Prices received a further boost
when the U.S. dollar weakened after Federal Reserve officials appeared to
question the pace of interest rate rises and from strong U.S.
manufacturing data. Headline copper inventories in LME-registered
warehouses fell by 5,425 tonnes to 161,025 tonnes, nearing last month's
10-year low of 136,675 tonnes. Another signal of tight supply is the
premium of cash copper over the three-month contract, which has drifted
from a near four-year high of $47 last month to $18.50 but is still far
above recent norms. Chinese copper smelter Jiangxi Copper and miner
Antofagasta agreed 2019 copper treatment and refining charges (TC/RCs)
at $80.80 a tonne and 8.08 cents a pound in the first big deal for next
year, lower than a 2018 benchmark of $82.25 a tonne and 8.225 cents a
pound. Chile's state copper agency Cochilco lowered its average copper
price prediction for this year by $0.03 to $2.97 per pound in its second
negative projection in six months. Copper inventories in warehouses
monitored by the Shanghai Futures Exchange fell 5.3 percent from last
Friday, the exchange said. Chile’s state copper agency Cochilco lowered
its average copper price prediction for this year by $0.03 to $2.97 per
pound on Thursday in its second negative projection in six months.
technically market is under short covering as market has witnessed drop
in open interest by -3.55% to settled at 11850, now Copper is getting
support at 436.6 and below same could see a test of 430.3 level, And
resistance is now likely to be seen at 446.7, a move above could see
prices testing 450.5.
OPEN HIGH LOW CLOSE % CHANGE OPEN INTEREST
437.40
SUPPORT 3
456.8 450.5 446.7 436.6 430.3 426.5
444.20 434.15 442.90 1.43 11850
RESIST 3 RESIST 2 RESIST 1 SUPPORT 1 SUPPORT 2
Trading Ideas :Copper trading range for the day is 430.3-450.5.
Chinese copper smelter Jiangxi Copper and miner Antofagasta agreed 2019 copper TC/RCs at $80.80 a tonne and 8.08 cents a pound.
Copper inventories in warehouses monitored by the Shanghai Futures Exchange fell 5.3 percent from last Friday, the exchange said.
Warehouse stock for Copper at LME was at 161025mt that is down by -5425mt.
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 6
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MCX Zinc Nov 2018
Zinc gained as LME stockpiles fell to a 10-1/2-year low, with signs that China may be moving to calm its trade dispute with the United States also boosting prices.
Zinc on MCX settled up 2.07% at 192.2 as LME stockpiles fell to a decade-
low, with signs that China may be moving to calm its trade dispute with
the United States also boosting prices. China has delivered a written
response to U.S. demands for wide-ranging trade reforms ahead of
expected talks between U.S. President Donald Trump and Chinese
President Xi Jinping at the G20 summit in Argentina later this month. LME
zinc stocks fell to a decade-low of 125,400 tonnes, data showed, while on-
warrant or available stocks hit their lowest since February. Zinc output in
October from China, the world's top producer of the metal, fell 7.6
percent from a year earlier to 501,000 tonnes, official data showed. The
global zinc market deficit narrowed to 54,700 tonnes in September from a
revised deficit of 81,800 tonnes in August, data from the International
Lead and Zinc Study Group (ILZSG) showed. The August data was
revised after it gave an initial estimate for a deficit of 76,200 tonnes. In
the first eight months of the year the zinc market had a 305,000 tonne
deficit, compared with a deficit of 398,000 tonnes in the same period last
year. US retail sales rebounded sharply in October as purchases of motor
vehicles and building materials surged, likely driven by rebuilding efforts
in areas devastated by Hurricane Florence, said the Commerce
Department. October retail sales increased 0.8% from September as
households purchased more electronics and appliances. Technically
market is under short covering as market has witnessed drop in open
interest by -2.9% to settled at 2915 while prices up 3.9 rupees, now Zinc
is getting support at 188.8 and below same could see a test of 185.2
level, And resistance is now likely to be seen at 194.4, a move above
could see prices testing 196.4.
OPEN HIGH LOW CLOSE % CHANGE OPEN INTEREST
188.9
SUPPORT 3
200.0 196.4 194.4 188.8 185.2 183.2
192.9 187.3 192.2 2.07 2915
RESIST 3 RESIST 2 RESIST 1 SUPPORT 1 SUPPORT 2
Trading Ideas :Zinc trading range for the day is 185.2-196.4.
LME zinc stocks fell to a decade-low of 125,400 tonnes, data showed, while on-warrant or available stocks hit their lowest since February.
Zinc output in October from China, fell 7.6 percent from a year earlier to 501,000 tonnes, official data showed.
Warehouse stock for Zinc at LME was at 124450mt that is down by -950mt.
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 7
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MCX Nickel Nov 2018
Nickel prices gained on signs of some easing in the trade war between the United States and China.
Nickel on MCX settled up 0.72% at 816.7 on signs of some easing in the
trade war between the United States and China. There are reports that
China submitted a written response to U.S. demands for trade reforms.
However, the gains were muted after a senior U.S. official expressed
concerns about the trade items China was unwilling to negotiation on.
Nickel inventories in the Shanghai bonded areas shrank 1,000 mt, or
3.3% from a week earlier to stand at 29,500 mt as of Friday November
16, data showed. As the import window opened in the second half of the
week, importers moved cargoes from bonded warehouses to the domestic
spot market. Some 600 mt in metal content of high-grade nickel pig iron
(NPI) output will be affected in November as the second round of national
environmental review extended to Shandong province. Affected
production accounted for some 1.7% of domestic high-grade NPI output
in October. From late October, five inspection teams from the central
government started to settle in Shanxi, Liaoning, Jilin, Anhui, Shandong,
Hubei, Hunan, Sichuan, Guizhou and Shaanxi provinces to supervise local
environmental conditions and review the implementation of rectification
plans that were made during previous environmental checks. The
eurozone trade surplus dropped sharply to €13.4 billion in September,
down from €16.6 billion in August. The weak reading was a result of a
weakness in exports, which fell 1% in September, on an annualised basis.
Technically market is under fresh buying as market has witnessed gain in
open interest by 1.44% to settled at 16328 while prices up 5.8 rupees,
now Nickel is getting support at 809.6 and below same could see a test of
802.6 level, And resistance is now likely to be seen at 823.4, a move
above could see prices testing 830.2.
OPEN HIGH LOW CLOSE % CHANGE OPEN INTEREST
811.3
SUPPORT 3
837.2 830.2 823.4 809.6 802.6 795.8
823.2 809.4 816.7 0.72 16328
RESIST 3 RESIST 2 RESIST 1 SUPPORT 1 SUPPORT 2
Trading Ideas :Nickel trading range for the day is 802.6-830.2.
Nickel inventories in the Shanghai bonded areas shrank 1,000 mt, or 3.3% from a week earlier to stand at 29,500 mt as of Friday November 16, data showed.
Some 600 mt in metal content of high-grade NPI output will be affected in November as the second round of national environmental review extended.
Warehouse stock for Nickel at LME was at 215442mt that is down by -732mt.
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 8
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NCDEX Jeera Dec 2018
Jeera dropped tracking weakness in spot demand due to higher arrivals in the physical market following ample stock.
Jeera on NCDEX settled down -1.63% at 19645 tracking weakness in spot
demand due to higher arrivals in the physical market following ample
stock. Jeera arrivals in Unjha mandi, Gujarat, were 6,528 bags (20
Kg/bag) compared to 6,410 bags on the previous day. Jeera sowing has
started in Gujarat on a poor note and farmers sown the spice on 1,500
hectares only. Jeera exports dropped by 20.8% to 10,769 tons in August
compared to 13,597 tons in the same period a year ago, according to
Ministry of Commerce data. However, Jeera arrivals in Unjha mandi,
Gujarat, were 6,410 bags compared to 11,870 bags on the previous day.
Jeera sowing has commenced in Gujarat and has been planted on 36,600
hectares, showed Gujarat state agriculture data. However, as per reports
the carry over stock of cumin was lowered to 200,000 - 300,000 bags
from expected stock of 500,000 bags this season. Traders are expecting
higher sowing this year because of prevailing high prices but lack of rains
may impact yield. Moreover, participants are expecting lower jeera
sowing this year as moisture in the soil is not sufficient to grow the
produce because of deficient rainfall in major producing regions.
Meanwhile, carryover stock of jeera was lowered to 200,000-300,000
bags from expected stock of 500,000 bags this season. Sowing was
expected to be higher due to prevailing high prices but lower rains in
producing areas of both the states may impact the yield and overall
output. Technically market is under fresh selling as market has witnessed
gain in open interest by 0.06% to settled at 5367, now Jeera is getting
support at 19513 and below same could see a test of 19382 level, And
resistance is now likely to be seen at 19873, a move above could see
prices testing 20102.
OPEN HIGH LOW CLOSE % CHANGE OPEN INTEREST
19860
SUPPORT 3
20230 20100 19870 19510 19380 19150
19970 19610 19645 -1.63 5367
RESIST 3 RESIST 2 RESIST 1 SUPPORT 1 SUPPORT 2
Trading Ideas :Jeera trading range for the day is 6548-6548.
Jeera arrivals in Unjha mandi, Gujarat, were 6,528 bags compared to 6,410 bags on the previous day.
NCDEX accredited warehouses jeera stocks dropped by 275 tonnes to 3071 tonnes.
In Unjha, a key spot market in Gujrat, jeera remains unchanged at0 rupees to end at 19953 rupee per 100 kg.
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 9
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NCDEX Turmeric Dec 2018
Turmeric dropped amid lower than expected exports and higher sowing turmeric areas of Tamilnadu, Karnataka and Maharashtra.
Turmeric on NCDEX settled down -1.3% at 6518 amid lower than
expected exports and higher sowing turmeric areas of Tamilnadu,
Karnataka and Maharashtra. As per reports, standing crop likely to
damage around 10 - 20% currently, if higher temperature will continue
next 15 - 20 days damage percentage may go up to 30-40%. Moreover,
turmeric sowing in all major producing states is higher than last year as
weather remained favourable. According to the Department of
Horticulture and Plantation Crops of Tamil Nadu, acreage of turmeric in
Erode may jump nearly 80% on year to 5,300 hectare in 2018-19 (Jul-
Jun) because of very good rainfall this year and availability of other water
sources. In Telangana, turmeric acreage rose to 47,790 hectare
compared to 44,956 hectare a year ago, state government data showed.
In Andhra Pradesh, farmers planted turmeric over area 18,000 hectares,
up from 14,000 hectares a year ago. The prices of the both varieties of
turmeric were increased. The sale and price has been increased due to
some local demands. The price of the finger turmeric increased by Rs.
450 a quintal at the Regulated Marketing Committee, Rs. 200 a quintal at
the Erode Turmeric Merchants Association Sales yard and Rs. 100 a
quintal at the Erode Cooperative Marketing Society. Technically market is
under fresh selling as market has witnessed gain in open interest by
0.42% to settled at 13060 while prices down -86 rupees, now Turmeric is
getting support at 6457 and below same could see a test of 6397 level,
And resistance is now likely to be seen at 6621, a move above could see
prices testing 6725.
OPEN HIGH LOW CLOSE % CHANGE OPEN INTEREST
6620
SUPPORT 3
6784 6724 6620 6456 6396 6292
6664 6500 6518 -1.30 13060
RESIST 3 RESIST 2 RESIST 1 SUPPORT 1 SUPPORT 2
Trading Ideas :Turmeric trading range for the day is 6396-6724.
Turmeric sowing in all major producing states is higher than last year as weather remained favourable.
NCDEX accredited warehouses turmeric stocks dropped by 10 tonnes to 3462 tonnes.
In Nizamabad, a major spot market in AP, the price ended at 7240.9 Rupees gained 5.9 Rupees.
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 10
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MCX Menthaoil Nov 2018
Menthaoil settled down as spot markets are witnessing low demand amid adequate supply which weighed on prices.
Menthaoil on MCX settled down -0.46% at 1796.4 as spot markets are
witnessing low demand amid adequate supply which weighed on prices.
Low demand outlook in mentha oil in domestic as well as global market
due to expectation of recovery in Indian Rupee against the U.S dollar.
Bumper crop harvest has been discounted in the market and market is
moving upwards on rising demand from end users. Arrivals in Sambhal
stood at 400 drums compared to 350 drum a day ago while in Barabanki
supplies rose to 500 drums from 450 drums a day earlier. According to
preliminary estimates, mentha oil production in 2018-19 would be 40,000-
45,000 ton against last year's production of 35,000 tons. There could be
chances of crop damage to certain extend due to unfavourable weather
condition. Mandi Department, which assumes Mentha as an agricultural
product and receives the mandatory duty of one and a half percent, the
GST of the same commerce tax department, Mentha crop, is not
considered as agricultural product and 15 percent GST is charged. Due to
this double tax, the price of mentha product increases, whereas synthetic
mentha is much cheaper, so many companies making mentha products
have started using synthetic mentha. Technically market is under fresh
selling as market has witnessed gain in open interest by 0.59% to settled
at 1193 while prices down -8.3 rupees, now Menthaoil is getting support
at 1787.3 and below same could see a test of 1778.2 level, And
resistance is now likely to be seen at 1806.2, a move above could see
prices testing 1816.
OPEN HIGH LOW CLOSE % CHANGE OPEN INTEREST
1795.00
SUPPORT 3
1825.1 1816.0 1806.2 1787.3 1778.2 1768.4
1806.90 1788.00 1796.40 -0.46 1193
RESIST 3 RESIST 2 RESIST 1 SUPPORT 1 SUPPORT 2
Trading Ideas :Menthaoil trading range for the day is 1778.2-1816.
Mentha oil spot at Sambhal closed at 1938.60 per 1kg. Spot prices was down by Rs.-12.30/-.
According to preliminary estimates, mentha oil production in 2018-19 would be 40,000-45,000 ton against last year's production of 35,000 tons.
However, there could be chances of crop damage to certain extend due to unfavourable weather condition.
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 11
TIME ZONE Forecast
CommodityLME STOCK Stock
COPPER -5425 161025
ALUMINIUM 8225 1066350
NICKEL -732 215442
LEAD -325 110575
ZINC -950 124450
4493 22390 19645 4649 6518 4139 507.2 3389
DAILY MARKET TRADING LEVEL
COMMODITIESNCDEX CHANA Dec
2018
NCDEX Cotton Nov
2018
NCDEX Jeera Dec
2018
NCDEX Guarseed10
Dec 2018
NCDEX Turmeric
Dec 2018
NCDEX Rmseed Dec
2018MCX CPO Nov 2018
NCDEX Soyabean
Dec 2018
NCDEX
Ref.Soya oil
Dec 2018
732.7CLOSE
P. POINT 4515 22400 19740 4673 6560 4153
4556 22500 19870 4730 6620 4175
RESISTANCE
4659 22720 20230 4868 6784 4234
511.6 3399 734
750
4618 22620 20100 4811 6724 4212 531.3 3456 745
538.9 3479
519.2 3422 739
4535 6396 4094 491.9 3342 723
4453 22280 19510 4592 6456 4116 499.5 3365
717
Cng in OI -1.83 -6.61 0.06 -3.95 0.42 -0.54 -9.03 -0.32 -6.15
SUPPORT
4350 22060 19150 4454 6292 4057 479.8 3308
728
4412 22180 19380
Long Liquidation
LME DAILY STOCK POSITION ECONOMICAL DATA
DATA Previous
2:30pm EUR Current Account 24.2B 23.9B
TREND Long Liquidation Long Liquidation Fresh Selling Long Liquidation Fresh Selling Long Liquidation Long Liquidation Long Liquidation
2:30pm EUR ECB Financial Stability Review 0 0
All Day EUR Eurogroup Meetings 0 0
4:30pm EUR German Buba Monthly Report 0 0
8:30pm USD NAHB Housing Market Index 67 68
9:15pm USD FOMC Member Williams Speaks 0 0
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
0 0 0 0 0
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 12
-5425
8225
-732-325
-950
-8000
-6000
-4000
-2000
0
2000
4000
6000
8000
10000
COPPER ALUMINIUM NICKEL LEAD ZINC
LME STOCK
NEWS YOU CAN USE
The U.S. Federal Reserve held interest rates steady but remained on track to keep gradually tightening borrowing costs, as it pointed to a healthy economy that was
marred only by a dip in the growth of business investment. Business investment can be a key to rising productivity and future growth, and the fact that it had “moderated
from its rapid pace,” as the Fed said, was the only cautionary note in a policy statement that touted strong job gains and household spending, and a “strong rate” of
overall economic activity. “The labour market has continued to strengthen and ... economic activity has been rising at a strong rate,” the U.S. central bank said, leaving
intact its plans to continue raising rates at a gradual pace. The Fed has hiked rates three times this year and is widely expected to do so again in December. The
statement overall reflected little change in the Fed’s outlook for the economy since its last policy meeting in September. Inflation remained near its 2 percent target,
unemployment fell, and risks to the economic outlook were still felt to be “roughly balanced.” Policymakers, however, took particular note of the moderation in business
investment, an important component of GDP that can spin off jobs as companies build new facilities, and raise productivity as they upgrade equipment and processes.
Boosting investment was one of the main objectives behind the Trump administration’s move to reduce the corporate tax rate as part of its restructuring of the tax code
at the end of 2017.
Economic growth in the euro area is set to ease gradually towards potential as the region does not display real signs of overheating that could put an untimely end to
growth, the European Commission said in its Autumn forecast, published. In the near term, economic growth is expected to continue at about the same pace as in the
first half of the year, resulting in euro area growth of 2.1 percent in 2018, which was unchanged from the previous projection. Eurozone growth hit a decade-high of 2.4
percent in 2017. Real GDP was forecast to grow 1.9 percent in 2019, which was slower than the 2 percent projected earlier. Growth was seen at 1.7 percent in 2020. "The
European economy is holding up well, with growth easing gradually," EU Economic Affairs Commissioner Pierre Moscovici said. "We project this pattern will continue over
the next two years, as unemployment continues to fall to levels not seen since before the crisis." According to the EU, trade tensions in emerging markets are
materializing. In Europe, uncertainty about the outlook for public finances in Italy has led to higher interest spreads, and the interaction of sovereign debt with the
banking sector is still of concern.
Deficient rains in cotton growing regions will hamper the yield for the kharif 2018-19 season, resulting in lower overall output of fibre crop. Farmers, therefore, have
pinned their hopes on increased cotton prices to make most from this kharif season. Gujarat, Maharashtra and Karnataka, which produce about half of the country's
cotton, faced water shortage due to erratic monsoon during the sowing period. The Bt seeds, used in most of the cotton fields, require adequate water. A deficient rainfall
has adversely affected the yield of Bt cotton. Farmers in Gujarat - the largest grower of the fibre crop - fear picking cycles to come down from normal 4-5 to merely one
or two this year. But they seem to be planning to make most fromthese one or two picking cycles by selling their crop when it is at its peak. The Centre, in its first
advance estimate in September 2018, projected lower cotton crop at 325 lakh bales (each of 170 kg), about sevenper cent lesser than 349 lakh bales estimated in fourth
advance estimate for 2017-18. Also, the carried over stock from the 2017-18 season was estimated to be one of the lowest in at least five years, which is further fuelling
prices. The Cotton Association of India (CAI) has projected total cotton supply for 2018-19 upto September 30, 2019 at 390.25 lakh bales, including opening stock of 23
lakh bales and imports of 24 lakh bales, higher by nine lakh bales compared 15 lakh bales estimated for 2017-18. The trade, however, believes that the crop will be lower
than last year at major growing states (West and South), but will get compensated by a possible growth in the Northern region.
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 13
Date : Monday, November 19, 2018 URL : www.systematixshares.com Page No : 14
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