Commodities Daily Report

Friday| February 15, 2013

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Research Team
Nalini Rao - Sr. Research Analyst nalini.rao@angelbroking.com (022) 2921 2000 Extn. 6135

Anish Vyas - Research Analyst anish.vyas@angelbroking.com (022) 2921 2000 Extn. 6104view:

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Commodities Daily Report

Friday| February 15, 2013

International Commodities
Overview
US Unemployment Claims declined to 341,000 for w/e on 8th Feb. European Flash GDP declined to 0.6 percent in Q4 of 2012. India's Wholesale Price Index (WPI) declined to 6.62 percent in Jan. German Prelim GDP declined by 0.6 percent in last quarter of 2012. Asian markets are trading lower today on the back of less profit earnings from the Australian and Japanese corporate companies. US Unemployment Claims declined by 27,000 to 341,000 for the week th ending on 8 February as against a rise of 368,000 in prior week. India's Wholesale Price Index (WPI) declined to 6.62 percent in January from earlier rise of 7.18 percent in December. Food Price Index was up by 11.88 percent in last month as against a rise of 11.16 percent in December. Fuel Price Index rose by 7.06 percent in January as compared to previous rise of 9.38 percent a month ago. Manufacturing inflation was at 4.81 percent in January with respect to 5.04 percent in December. US Dollar Index (DX) appreciated by 0.5 percent yesterday on account of rise in risk aversion in the global market sentiments which led to increase in demand for the low yielding currency. Apart from that, unfavorable economic data from the Euro region also supported an upside in the DX. However, sharp upside in the currency was capped on the back of US unemployment claims data coming on a positive note. It touched an intra-day high of 80.71 and closed at 80.54 on Thursday. The Indian Rupee depreciated around 0.3 percent in yesterdays trading session. The currency depreciated on the back of weak domestic market sentiments along with strength in the DX. Additionally, dollar demand from oil companies also exerted downside pressure on the currency. However, sharp downside in the currency was cushioned on account of countrys wholesale price index data coming on a favorable note. It touched an intra-day low of 54.02 and closed at 53.98 against dollar on Thursday. For the month of January 2013, FII inflows totaled at Rs.20,538.70 crores th ($3,854.53 million) as on 14 February 2013. Year to date basis, net th capital inflows stood at Rs.42,597.70 crores ($7,913.90 million) till 14 February 2013.

Market Highlights (% change)

Last INR/$ (Spot) 53.98 Prev day -0.3

as on 14 February, 2013 w-o-w -1.4 m-o-m 1.0 y-o-y -8.3

$/Euro (Spot)

1.336

-0.7

-0.3

-0.2

1.8

Dollar Index NIFTY

80.54

0.5

0.4

1.3

1.1

5897.0

-0.6

-0.7

-2.1

8.9

SENSEX

19497.2

-0.6

-0.4

-2.1

9.2

DJIA

13973.4

-0.1

0.2

3.5

8.5

S&P

1521.4

0.1

0.8

3.4

13.1

Source: Reuters

The Euro depreciated by 0.7 percent yesterday on the back of French Prelim Gross Domestic Product (GDP) declined by 0.3 percent in Q4 of 2012 as against a rise of 0.1 percent in Q3 of 2012. German Prelim GDP declined by 0.6 percent in last quarter of 2012 from rise of 0.2 percent in Q3 of 2012. French Prelim Non-Farm Payrolls declined by 0.2 percent in Q4 of 2012 as compared to earlier fall of 0.3 percent a quarter ago. Italian Prelim GDP fell by 0.9 percent in Q4 of 2012 with respect to drop of 0.2 percent in prior quarter. European Flash GDP declined to 0.6 percent in the last quarter of 2012 from earlier plunge of 0.1 percent in Q3 of 2012. Additionally, strength in the DX coupled with weak global market sentiments also acted as a negative factor for the currency. The Euro touched an intra-day low of 1.3313 and closed at 1.336 against dollar on Thursday.

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Commodities Daily Report

Friday| February 15, 2013

Bullion Gold

International Commodities

Spot gold prices continued to add to the losses of the previous day taking cues from weak economic data from the Euro zone region which renewed worries amongst the market participants. Apart from decline in the global gold demand in 2012 as reported by the World Gold Council (WGC) also weighed on the market sentiments. Positive jobs data from the US in yesterdays session also acted as a bearish factor for the yellow metal as the demand for the metal as hedge against inflation might reduce. Strength in the DX also added to the losses in the gold prices on Thursday. Spot gold prices ended 0.4 percent down in yesterdays session. The yellow metal touched an intra-day low of $1,632.34 per ounce and closed at $1,635.4 per ounce on Thursday. On the MCX, Gold April contract ended 0.3 percent lower. MCX gold prices traced weakness in the spot gold prices. However, depreciation in the rupee cushioned fall in the MCX gold prices. Gold prices on the MCX closed at Rs. 30,463/10 gms on Thursday after touching an intra-day low of Rs. 30452 / 10gms.

Market Highlights - Gold (% change)

Gold Gold (Spot) Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (April13) MCX Gold (April13) Unit $/oz Rs/10 gms $/oz Last 1635.1 30250.0 Prev. day -0.4 0.3

as on 14 February, 2013 WoW -2.1 -0.4 MoM -1.9 #N/A YoY -4.9 9.0

1646.0

0.1

-1.3

-1.2

-4.4

$/oz

1634.7

-0.6

-2.1

-2.0

-4.7

Rs /10 gms

30463.0

-0.3

-1.1

-0.9

#N/A

Source: Reuters

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (Mar13) MCX Silver (Mar13) Unit $/oz Rs/1 kg Last 30.4 58300.0 Prev day -1.0 0.0

as on 14 February, 2013 WoW -3.2 -1.0 MoM -1.9 -0.1 YoY -9.3 4.2

Silver
Tracing weakness in the spot gold prices along with strength in the DX, spot Silver prices also declined 1 percent. Weakness in most of the base metals also acted as a bearish factor for the gold prices. In the Indian markets prices of silver on MCX witnessed a decline and ended 1.4 percent lower taking cues from fall in the spot silver prices. However, depreciation in the rupee cushioned fall in the gold prices in yesterdays session. The white metal touched an intra-day low of $ 30.2 /oz and closed at $ 30.4 per oz on Thursday. In the Indian markets, MCX silver prices ended 1.4 percent down and closed at Rs. 56,630/kg on Thursday and touched an intra-day low of Rs. 56,550 / kg.

$/oz $/ oz

3088.0 3034.3

-0.5 -1.7

-2.7 -3.3

0.4 -2.4

-7.8 -9.0

Rs / kg

56630.0

-1.4

-2.4

-3.6

#N/A

Source: Reuters

Outlook
In todays session we expect precious metal to trade on a bearish note as positive data from the US has reduced the buying of the metal as hedge against inflation. Investors are also awaiting the two day meeting of G-20 finance ministers for clues over the global growth and their views on currencies. Thus investors might adopt cautious approach. However, weakness in the DX is expected to cushion fall in the precious metals. Depreciation in the Rupee is expected to cushion fall in the MCX prices of precious metals. Technical Outlook
Unit Spot Gold MCX Gold Apr13 Spot Silver MCX Silver Mar13 $/oz Rs/10 gms $/oz Rs/kg valid for February 15, 2013 Support 1627/1622 30380/30300 30.15/29.90 56300/55900 Resistance 1635/1641 30520/30630 30.50/30.70 56900/57200

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Friday| February 15, 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices increased by 0.3 percent yesterday on the back of United Nations inspectors unable to reach a deal with Iran coupled with US unemployment claims coming on a favorable note. However, sharp upside in the crude oil prices was capped as a result of strength in the DX. Crude oil prices touched an intra-day high of $97.71/bbl and closed at $97.31/bbl in yesterdays trading session. On the domestic bourses, prices gained by 0.1 percent on account of depreciation in the Indian Rupee and closed at Rs.5,255/bbl after touching an intra-day high of Rs.5,268/bbl on Thursday. Market Highlights - Crude Oil (% change)
Crude Oil WTI (Spot) Brent (Spot) Nymex Crude (March13) ICE Brent Crude (March13) MCX Crude (Feb 13) Unit $/bbl $/bbl $/bbl Last 97.3 119.7 97.3 Prev. day 0.3 0.0 0.3 WoW 1.5 1.2 1.5 as on 14 February, 2013 MoM 3.2 6.9 3.4 YoY -3.5 0.0 -3.4

$/bbl

118.0

-0.6

0.6

5.5

-0.1

Rs/bbl

5249.0

0.0

2.3

2.9

#N/A
Source: Reuters

Natural Gas
EIA Inventories Data US Energy Information Administration (EIA) released its weekly inventories yesterday and US natural gas inventory declined less than expected by 157 billion cubic feet (bcf) which stood at 2.527 trillion cubic feet for the week ending on 8th February 2012. Nymex natural gas prices declined by 3.7 percent on the back of less than expected decline in US natural gas inventories coupled with strength in the DX. Additionally, forecast for less cool winter weather also acted as a negative factor for the prices. Gas prices touched an intra-day low of 3.135/mmbtu and closed at $3.17/mmbtu on Thursday. On the domestic front, prices fell by 4.8 percent and closed at Rs.170.3/mmbtu after touching an intra-day low of Rs.169.80/mmbtu in yesterdays trade. Depreciation in the Indian Rupee cushioned further fall in the prices. Outlook In todays session, we expect crude oil prices to trade higher on expectation that OPEC might cut the crude shipments this month along with weakness in the DX. There are also indications of rise in the open interest for the US benchmark grade which rose to record highs. This might also initiate buying by the market participants. Depreciation in the Indian Rupee will support an upside in the crude oil prices on the MCX. Technical Outlook
Unit NYMEX Crude Oil MCX Crude Feb 13 $/bbl Rs/bbl valid for February 15, 2013 Support 96.70/95.90 5220/5180 Resistance 97.80/98.40 5290/5320
Source: Telequote

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (Feb 13) Unit $/mmbtu Rs/ mmbtu Last 3.17 170.3 Prev. day -3.76 -4.86

as on 14 February, 2013

WoW -3.53 -4.59

MoM -6.16 -8.29

YoY 24.51 35.37

Source: Reuters

Technical Chart NYMEX Crude Oil

Source: Telequote

Technical Chart NYMEX Natural Gas

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Commodities Daily Report

Friday| February 15, 2013

Base Metals

International Commodities
Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (Feb13) LME Aluminum (3 month) MCX Aluminum (Feb13) LME Nickel (3 month) MCX Nickel (Feb13) LME Lead (3 month) MCX Lead Feb13) LME Zinc (3 month) MCX Zinc (Feb13)
Source: Reuters

Base metals pack traded on the negative note in the yesterdays session except for copper and aluminium prices closing on a positive note. This was on the account of weak data from Europe which showed that the economies are still reeling under pressure. French and German GDP declined in the fourth quarter by 0.3 percent and 0.6 percent respectively. Subdued trade by the market participants on the back of Lunar Year in China also depressed the metals prices. Strength in the DX also pressurised the base metals prices. Depreciation in the Indian Rupee however restricted losses in the MCX prices.

as on 14 February, 2013 WoW 0.3 MoM 2.9 YoY -1.8

Last 8237.5

Prev. day 0.0

$/tonne

Rs/kg

445.7

0.2

1.0

1.2

6.7

$/tonne

2152.0

0.6

2.3

4.6

-3.0

Rs /kg

114.7

0.9

2.9

3.4

5.7

Copper
Copper prices ended on a flat note on Thursday. Weak economic data from the Euro zone region along with strength in the DX exerted downside pressure while positive data from the US cushioned fall in the prices of the red metal. Further, hopes of rise in the demand for the metal from China, the largest consumer of the metal also acted as supportive factor for the copper prices. Trading volumes however, remained thin due to ongoing Lunar New Year holidays. Rise in the copper inventories on the LME by 0.05 percent also capped gains in the copper prices in yesterdays session. LME Copper inventories rose 0.05 percent yesterday and stood at th 399,125 tonnes on Thursday as against 398,925 tonnes on 13 February 2013. Copper prices on LME touched an intra-day high of $8,259.25 per tonne and closed at $8,237.5 per tonne on Thursday. In the domestic markets MCX copper rose 0.2 percent and closed at Rs. 445.7 per kg on Thursday due to depreciation in the Indian rupee. Outlook In todays session, we expect base metals to trade higher on hopes of rise in the demand from the China after the Lunar New Year holidays (i.e. next week) along with positive data from the US. Favorable data from the US is showcasing growth which might increase the demand for the metal. Weakness in the DX is also expected to add to the gains. Depreciation in the Indian Rupee will support an upside in the base metals prices on the MCX. Technical Outlook
Unit MCX Copper Feb13 MCX Zinc Feb 13 MCX Lead Feb 13 MCX Aluminum Feb13 MCX Nickel Feb 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for February 15, 2013 Support 444/442 116.6/115.8 129.2/128.4 114/113.2 977/968 Resistance 447/449 118.2/119 130.5/131.2

$/tonne

18272.0

-0.7

0.7

5.4

-9.1

Rs /kg

984.3

-0.7

1.3

4.3

-1.5

$/tonne

2412.5

-0.1

-0.1

5.0

15.7

Rs /kg

129.9

0.2

0.6

3.8

27.0

$/tonne

2186.5

-0.8

1.4

9.3

7.2

Rs /kg

117.3

-0.3

2.0

8.1

16.2

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 14th February 399125 5147800 153720 1188100 287075 13th February 398925 5147225 153912 1188100 287350 Actual Change 200 575 -192 0 -275 (%) Change 0.05 0.01 -0.12 0.00 -0.10
Source: Reuters

Technical Chart LME Copper

Source: Telequote

115.2/116 994/1002

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Commodities Daily Report

Friday| February 15, 2013

International Commodities
Important Events for Today

Indicator Bank Holiday Retail Sales m/m Empire State Manufacturing Index TIC Long-Term Purchases Capacity Utilization Rate Industrial Production m/m Prelim UoM Consumer Sentiment Mortgage Delinquencies G20 Meetings

Country China UK US US US US US US All

Time (IST) All Day 3:00pm 7:00pm 7:30pm 7:45pm 7:45pm 8:25pm th th 15 19 Day 1

Actual -

Forecast 0.5% -2.1 34.3B 78.9% 0.2% 74.8 -

Previous -0.1% -7.8 52.3B 78.8% 0.3% 71.3 7.40% -

Impact High Medium Medium Medium Medium High Medium High

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