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Published on 21/08/2019 9:34:32 AM | Source: Angel Broking Pvt Ltd

We expect gold and silver prices to trade higher - Angel Commodities

Posted in Commodities Reports| #Commodity Tips #Angel Broking Pvt Ltd

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Bullion

Gold

On Tuesday, spot gold prices ended higher by 0.79 percent to close at $1506.9 per ounce. After dipping below the $1500 mark in the earlier trading session prices bounced back as Investors wait for the minutes of the U.S. Federal Reserve’s July meeting for further hints on their stance.

The markets expect another rate cut by the U.S. FED in their next meeting in September 2019 which weighed on the U.S. Dollar and in turn supported the bullion metal.

However, the dispute between U.S. & China showed some signs of easing the intense trade war which boosted the risk appetite amongst investors. Rising bond yields globally amid easing of tension between the biggest economies in the world dented the appeal for the bullion metal.

Silver

On Tuesday, Spot silver prices rose by 1.54 percent to close at $17.1 per ounce while MCX silver prices rose by 1.18 percent to close at Rs.43941.0 per kg.On Monday, Spot silver prices dipped over 1.2 percent to close at $16.9 per ounce while MCX silver prices rose by 0.9 percent to close at Rs.43430 per kg.

Outlook

We expect gold and silver prices to trade higher as rising expectation of a possible rate cut might push the Dollar lower and in turn support Gold.

On the MCX, gold prices are expected to trade higher today; international markets are trading lower by 0.07 percent to close at 1514.65 per ounce

 

Energy

Crude Oil

On Tuesday, WTI Crude prices rose by 0.23 percent to close at $56.3 per barrel. Prices were pushed higher after the weekend attack on the Saudi’s Oil facility by the Yemen’s Houthi force.

Moreover, Prices also found some support over expectation of a dip in the U.S. Crude inventory levels this week after consecutive build up in the past 2 weeks.

The intense trade war between U.S. & China showed signs of easing of tension as the U.S. stated that it would extend a reprieve that would permit China's Huawei Technologies to continue buying components from U.S. companies. Signs of easing tension between the biggest oil consumers might improve the demand prospects for Crude.

However, the gains for Crude were capped after the Organization of the Petroleum Exporting Countries (OPEC) trimmed down its forecast its forecast for global oil demand growth in 2019 by 40,000 barrels per day (bpd) to 1.10 million bpd. Bearish approach by the OPEC weighed on the prices.

Outlook

Easing of tension between U.S. & China coupled with expectation of a dip down in the U.S. Crude inventory levels might support Crude prices. However, the gains were capped after OPEC trimmed down its demand growth forecast for this year.

We expect oil prices to trade higher today, international markets are trading higher by 0.37 percent at $56.34 per barrel.

 

Base Metals

On Tuesday, base metals on the LME traded negative except for Lead which ended higher by 0.34 percent. Downfall in China’s manufacturing sector over the prolonged tension between U.S. & China dampened the demand prospects for the industrial metals as China is the biggest metal consumer.

However, the trade tension between U.S. & China showed signs of easing as the U.S. stated that it would extend a reprieve that would permit China's Huawei Technologies to continue buying components from U.S. companies.

As per reports from the International Aluminium Institute (IAI), the Global primary aluminium production rose to 5.405 million tonnes in July, 2019 from a revised figure of 5.275 million tonnes in June, 2019.

 

Copper

On Tuesday, LME Copper prices ended marginally lower by 1.09 percent to close at $5711.0 per tonne. Falling demand from China, the biggest metal consumer weighed on the Copper prices. The LME Copper inventories levels are currently at 329,600 tonnes double of what was there in the end of May.

Outlook

Falling demand from the biggest metal consumer, China would weigh on the industrial metal prices. However, expectation of a rate cut by the U.S. Federal Reserve might weigh on the U.S. Dollar and In turn support the industrial metal prices.

On the MCX, Copper prices are expected to trade higher today; international markets trading higher by 0.23 percent at $5729.5 per tonne.

 

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