Commodities Daily Report

Wednesday| September 11, 11 2013

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Research Team
Reena Rohit Chief Manager Non-Agri Currencies and Commodities Reena.rohit@angelbroking.com (022) 2921 2000 Extn :6134 Anish Vyas Research Analyst anish.vyas@angelbroking.com (022) 2921 2000 Extn :6104

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Commodities Daily Report

Wednesday| September 11, 11 2013

International Commodities
Overview
Indian Rupee appreciated more than 2 percent in yesterdays trade. Syria tensions eases after US pulled out its military actions. French Industrial Production declined by 0.6 percent in month of July. Asian markets are trading higher today on the back of US President Barack Obama pulled US from the verge of military strike against Syria Syria. The Dollar Index closed on a flat note on Tuesday as a sense of caution has as developed ahead of the FOMC monetary policy review scheduled on the 18th Sep13. While the Fed had indicated in the past that the QE taper could begin from Sep13 onwards, the likelihood of it getting postponed is also seen considering the ongoing Syria Syrian geopolitical tensions that still need a focused strategy to resolve resolve. Reversal in the Rupee became even stronger with the currency appreciating around 2.1 percent in yesterdays trade to close at 63.84 per dollar. In intraday trade on Tuesday, the Rupee e touched a high of 63.775 per dollar and gains in the currency were backed by strong inflows from FIIs that purchased approximately around Rs2563.6cr of Indian shares on Tuesday, dollar selling by banks on expectations of further gains in the Rupee and overall upbeat risk appetite due to strong global and domestic equities. For the month of September 2013, FII outflows totaled at Rs.2162.10 th crores ($329.10 million) as on 10 September 2013. Year to date basis, net capital inflows stood at Rs.62331.90 crores ($11912.40 million) till th 10 September 2013. Japans Business Survey Index (BSI) Manufacturing Index increased by 10.2 points to 15.2-mark in Q3 of 2013 from 5-level in Q2 of 2013. Corporate Goods Price Index (CGPI) increased by 2.4 percent in August as against a rise of 2.3 percent a month ago.

Market Highlights (% change)

Last INR/$ (Spot) 63.84 Prev day 2.1

as on September 10, 2013 w-o-w 5.6 m-o-m -5.1 y-o-y -13.3

$/Euro (Spot)

1.3267

0.1

0.7

-0.8

3.5

Dollar Index NIFTY

81.82

0.0

-0.7

0.0

3.0

5896.8

0.0

10.4

5.9

10.4

SENSEX

19997.1

3.8

9.7

6.4

9.3

DJIA

15191.1

0.8

2.4

-1.7

14.6

S&P

1684.0

0.7

-0.4

-0.4

17.8

Source: Reuters

The Euro witnessed gains of around 0.1 percent in yesterdays trade as positive economic data supported gains in the currency. Further, upbeat global market sentiments acted as a positive factor. However, sharp upside in the currency was capped as a result of strength in the DX. The Euro touched an intra-day day high of 1.3275 and closed at 1.3267 on Tuesday. French Industrial Production declined by 0.6 percent in July as against a fall of 1.4 percent a month ago.

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Commodities Daily Report

Wednesday| September 11, 11 2013

International Commodities
Bullion Gold
Ahead of the FOMC monetary policy review, investors are taking a cautious approach towards gold. On the back of this, gold prices continued its decline on Tuesday, with Spot Gold prices falling around 1.7 percent to close at $1363.3/oz. Prices on the near near-month gold futures contract was also weak, as prices fell sharply by 2.5 percent to close at Rs30,753/10gm. Appreciation in the Rupee led to sharper fall in Indian gold prices. Further appreciation in the Rupee could lead to sharp correction in gold prices ahead of the Indian festival and traditional demand season. Data on the domestic gold market showed that imports of the yellow metal in August13 fell around 95 percent to just 2.5 tonnes from a month before. While this may give a sense of easing conce concerns on the CAD front, we feel that the sentimental effect could only be temporary as the fall in gold imports last month was mainly as a result of lack of clarity. Also with pick up in gold imports now, what remains to be seen is how gold imports take shape e ahead of the festive season, when demand generally peaks. But overall gold imports have shown a decline from 162 tonnes in May13 to 31.5 tonnes in June13 and 47.5 tonnes in July13. Market Highlights - Gold (% change)
Gold Gold (Spot) Unit $/oz Last 1363.6 Prev. day -1.6 as on September 10, 2013 WoW -3.4 MoM 4.0 YoY -21.5

Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (Oct13) MCX Gold (Oct13)

Rs/10 gms $/oz

30500.0

-3.8

-8.0

8.9

2.3

1358.3

-2.3

-2.9

4.6

-21.4

$/oz

1364.1

-1.6

-1.9

2.3

-21.1

Rs /10 gms

30753.0

-2.5

-10.7

10.2

-3.8

Source: Reuters

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (Dec13) MCX Silver (Sept13) Unit $/oz Rs/1 kg Last 22.9 53690.0 Prev day -3.0 -1.1

as on September 10, 2013 WoW -5.1 -7.9 MoM 13.6 27.1 YoY -31.8 -1.8

Silver
Silver prices witnessed a decline of 3 percent yesterday and closed at $22.90/oz. taking cues from fall in gold prices along with downside in base metals complex. Indian markets appreciation in the Rupee exerted downside pressure on prices.

$/oz $/ oz

2332.0 23.0

-1.4 -3.0

-3.7 -1.7

18.2 5.4

-27.6 -31.5

Rs / kg

52235.0

-3.5

-8.9

23.7

-18.5

Outlook
Technical Chart Spot Gold Over todays trade, precious metals are expected to trade with a negative bias and a stronger Rupee in the Indian markets will add additional downside pressure. Technical Outlook
Unit Spot Gold MCX Gold Oct13 Spot Silver MCX Silver Sept13 $/oz Rs/10 gms $/oz Rs/kg valid for September 11 11, 2013 Support 1364/1355 30600/30450 22.90/22.70 51700/51200 Resistance 1375/1389 30900/31100 23.40/23.60

Source: Reuters

Source: Telequote

52800/53300

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Commodities Daily Report

Wednesday| September 11, 11 2013

International Commodities
Energy Crude Oil
The rally in crude oil prices in the recent past was triggered by risks of supply disruptions of oil from the Middle East region as geopolitical tensions develop in Syria. While Syrian concerns still remain, the threat of the crisis spreading to other Middle le East countries has come down on the back of diplomatic decision-making making towards action on Syria for its chemical weapon attack. With no major military attack expected by the US in the near futures, supply fears have reduced and this has led to selling pressure essure in crude oil prices that fell to a 2 2-week low on the Nymex yesterday. In intraday trade, oil prices fell around 2 percent to close at $107. $107.4/bbl and Brent crude oil prices also tumbled 2 percent, closing at $111.49/bbl yesterday. With Syria accepting ting a Russian proposal to give up its chemical weapons, markets received a sigh of relief on hopes of no major US-led led action. In the India markets, the near near-month crude oil contract fell by more than 3 percent to close at Rs68 Rs6836/bbl. Prices have fallen below low the crucial Rs7000/bbl mark, a level that was achieved mainly due to the weaker Rupee. In the week ended 25th Aug13, crude oil prices on the MCX had touched a high of Rs7784/bbl. With the reversal in the trend of the Rupee, oil prices in the Indian ma markets are expected to witness more declines than that in the international markets. Inventories Scenario On the inventory front, it was seen that the API (American Petroleum Institute) monitored weekly inventories showed a sharp decline of 2.93 million barrels. However, prices did not receive much respite as the focus in the oil markets has been shifted to th the geopolitical developments in Syria. The EIA (Energy Information Administration) report is also expected to show a decline of 1.5 million barrels of oil inventories for the last week. Outlook Despite expectations of fall in EIA oil inventories, oil prices are expected to trade on a negative note today as concerns over supply disruptions ease as no major military action is expected against Syria. A stronger Rupee will lead to sharp decline in oil prices in the Indian markets today today. Technical Outlook
Unit NYMEX Crude Oil MCX Crude Sep13 $/bbl Rs/bbl valid for September 11 11, 2013 Support 105.90/105.10 6770/6720 Resistance 107.60/108.50 6880/6940
Source: Telequote

Market Highlights - Crude Oil (% change)

Crude Oil Brent (Spot) Nymex Crude (Oct 13) ICE Brent Crude (Sep13) MCX Crude (Sep 13) Unit $/bbl $/bbl Last 114.1 107.4 Prev. day -2.6 -1.9

as on September 10, 2013 WoW -2.9 -1.1 MoM 5.2 0.5 YoY 0.6 11.2

$/bbl

111.3

-2.2

-3.8

4.3

-2.6

Rs/bbl

6836.0

-3.1

-8.9

9.7

28.8

Source: Reuters

Market Highlights - Natural Gas (% change)

Natural Gas (NG) Nymex NG MCX NG (Sep 13) Unit $/mmbtu Rs/ mmbtu Last 3.581 228.8 Prev. day -0.8 -1.1

as on September 10, 2013 MoM 11.31 15.73 YoY 34.37 54.28

Source: Reuters

WoW -2.32 -9.81

Technical Chart NYMEX Crude Oil

Source: Telequote

Technical Chart NYMEX Natural Gas

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Commodities Daily Report

Wednesday| September 11, 11 2013

International Commodities
Base Metals
Base metals pack on the LME traded on a negative note yesterday due to strength in the DX. Further, mixed LME inventories scenario added downside pressure on prices. However, sharp downside in prices was cushioned as a result of upbeat global market sentiments and positive data from China China. In the Indian markets, appreciation ion in the Rupee led to fall in prices on the MCX. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (Nov13) LME Aluminum (3 month) MCX Aluminum (Sep13) Rs /kg 113.2 -1.2 -8.6 2.8 2.4 $/tonne 1804.0 -0.2 -1.1 -2.2 -10.7 Rs/kg 467.3 -1.3 -8.4 6.5 4.6 $/tonne Last 7174.0 as on September 10, 2013 WoW -1.1 MoM -8.6 YoY -10.1

Prev. day -0.4

Copper
LME Copper prices declined 0.4 percent yesterday yesterday, mainly taking positive cues from strength in the DX. However, upbeat global market sentiments and 1 percent decline in inventories, which stood at 588,475 tonnes cushioned sharp fall in prices. Additionally, favourable economic data from China in yesterdays trade also restricted fall in prices. The red metal touched an intraday low of $7149.75/tonne /tonne and closed at $ $7174/tonne on Tuesday. In the Indian markets, the MCX near-month copper contract declined by 1.3 percent due to Rupee appreciation. The metal closed at Rs.467.3/kg in yesterdays trading session. Outlook In todays session, we expect base metals prices to trade on a mixed note on the back of upbeat global market sentiments sentiments. Further, weakness in the DX will support an upside in prices. Additionally, favorable economic data from China in yesterdays trade will act as a positive factor. However, mixed inventories scenario will ll add downside pressure on prices. In n the Indian markets, appreciation in the Rupee will add more downside pressure in prices on the MCX. Technical Outlook
Unit MCX Copper Nov13 MCX Zinc Sep13 MCX Lead Sep 13 MCX Aluminum Sep13 MCX Nickel Sep 13 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for September 11 11, 2013 Support 464/460 117.50/116.50 134.50/133.50 112.0/111.0 862/855 Resistance 472/476 119.50/120.50 136.80/137.70 114.20/115.0 881/888

LME Nickel (3 month) MCX Nickel (Sep13) LME Lead (3 month) MCX Lead (Sep13) LME Zinc (3 month) MCX Zinc (Sep13)

$/tonne

13690.0

-1.8

-0.6

-4.3

-16.7

Rs /kg

871.1

-2.8

-8.1

0.3

-4.2

$/tonne

2140.0

-0.8

-0.7

0.1

2.0

Rs /kg

135.4

-1.8

-8.7

4.4

17.6

$/tonne

1881.0

-0.3

-1.2

-0.8

-4.1

Rs /kg

118.4

-1.4

-9.1

4.0

10.2

Source: Reuters

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 10th September 588,475 5,364,425 215,808 985,525 181,425 9th September 594,625 5,370,350 215,388 985,375 182,375 Actual Change -6,150 -5,925 420 150 -950 (%) Change -1.0 -0.1 0.2 0.0 -0.5

Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Wednesday| September 11, 11 2013

International Commodities
Important Events for Today
Indicator Country Time (IST) Actual Forecast Previous Impact

BSI Manufacturing Index Claimant Count Change Average Earnings Index 3m/y Unemployment Rate German 10-y Bond Auction Crude Oil Inventories MPC Member Miles Speaks 10-y Bond Auction

Japan UK UK UK Euro US UK US

5:20am 2:00pm 2:00pm 2:00pm Tentative 8:00pm 9:00pm 10:30pm

15.2 -

7.2 -21.2K 1.3% 7.8% -1.5M -

5.0 -29.2K 29.2K 2.1% 7.8% 1.8/1.3 -1.8M 1.8M 2.62/2.5

Medium High Medium Medium Medium Medium Medium Medium

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