Commodities Daily Report

Monday| December 03, 2012

International Commodities

Content
Overview Precious Metals Energy Base Metals Important Events for today

Overview:

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. 6104

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Commodities Daily Report

Monday| December 03, 2012

International Commodities
Overview
US Chicago PMI increased to 50.4 in November Chinese manufacturing PMI rose to 50.6 levels in November. US Personal Spending declined to 0.2 percent in October US Core PCE Price Index remained steady at 0.1 percent Asian markets are trading on a firm note taking cues from positive data from the Chinese economy indicating that the second largest economy is on the path of recovery. Chinese manufacturing PMI increased to 50.6 levels in the month of November as compared to 50.2 levels in October. US Chicago PMI increased to 50.4 levels in the month of November as compared to 49.9 levels in the month of October. US Personal Spending m/m however declined to 0.2 percent in the month of October as compared to a rise of 0.8 percent in the month of September. US Core PCE Price Index remained steady at 0.1 percent in the month of October. US dollar Index declined 0.09 percent week on week. US Dollar swung between gains and losses in the last week. The Index remained lower in the early part of the week on the back of positive economic data from the US and on expectation that the US lawmakers and President Barack Obama might be able to resolve the fiscal cliff issue and cut budget deficit. Additionally, agreement amongst European Finance Ministers to provide aid to Greece also weighed on the index. However, towards the end of the week worries over the fiscal cliff and doubts over its resolution weighed on the market sentiments. US equities traded with a positive note in the last week taking cues from favorable data from the nation along with expectations that the US policy makers might be able to resolve the fiscal cliff issue. The index touched a intra-day low of 80.025 and closed at 80.16 on Friday.

Market Highlights (% change)

Last INR/$ (Spot)
54.26

as on 30 November, 2012

Prev day
0.8

w-o-w
2.1

m-o-m
-0.6

y-o-y
-5.3

$/Euro (Spot)

1.2984

0.1

0.1

0.2

-3.6

Dollar Index

80.16

-0.1

-0.1

0.2

2.2

NIFTY

5879.9

0.9

4.5

5.0

19.1

SENSEX

19339.9

0.9

4.5

4.9

17.3

DJIA

13025.6

0.0

0.1

#N/A

8.4

S&P

1416.2

0.0

0.5

0.3

13.6

Source: Reuters

The Indian Rupee appreciated by 2.13 percent in the last week. The Indian Rupee depreciated in the early part of the week on the back of dollar demand from the oil exporters and refiners and no discussion in the parliament made over the FDI reforms announced. However, with optimism seen that the FDI might be passed in the parliament along with weak DX, rupee erased earlier depreciation and settled in appreciation. It touched a weekly high of 54.23 and closed at 54.26 on Friday. In the month of November, FII inflows totaled at Rs. 9577crores till 30th November 2012. While year to date basis, net capital inflows stood at Rs. 103,272.10 crores till November 2012.

Euro increased 0.06 percent week on week. European Finance Ministers along with International Monetary Fund agreeing on providing aid to Greece. Further, approval of provision of aid to Greece by the German law makers created positive market sentiments. Weakness in the DX also supported an upside in the currency. The currency touched a weekly high of 1.3027 and closed at 1.2984 on Friday. German Unemployment Change rose to 5000 levels to 2.94 million in the month of October as against a rise of 19000 in the month of September. Italian 10-y Bond Auction declined to 4.45|1.2 as Spain raised its own financing this year and skips bailout.

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Commodities Daily Report

Monday| December 03, 2012

Bullion Gold

International Commodities

Spot gold prices declined 2.2 percent week on week on worries amongst global participants as to how the US law makers would solve the fiscal cliff issue. If, they fail to arrive at a budget cut, the economy might slip into recession. However, weakness in the DX cushioned sharp fall in the prices. The yellow metal touched weekly low of $1,705.64/oz and closed at $1714.4 on Friday. On the MCX, Gold December contract ended 3.7 percent lower taking cues from bearishness in the spot gold prices along with appreciation in the Indian rupee. Gold prices on the MCX closed at Rs.31,076/10 gms on Friday after touching a weekly low of Rs. 31,040/ 10gms. During the week prices on MCX had touched a historical high of Rs. 32464 per 10 gms. Holdings in the SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 0.5 percent to 1348.83 tonnes till November 30th, 2012 as compared to 1342.197 tonnes till November 23rd, 2012

Market Highlights - Gold (% change)

Gold Gold (Spot) Gold (Spot -Mumbai) Gold (LBMA-PM Fix) Comex Gold (Dec12) MCX Gold (Dec12) Unit $/oz Rs/10 gms $/oz
1726.0 0.1

as on 30 November, 2012 Prev day

-0.6

Last
1714.4

WoW
-2.2

MoM
0.3

YoY
-1.7

31375.0

-0.6

-2.1

2.5

7.6

-0.5

0.9

-1.5

$/oz

1710.9

-0.9

-2.3

0.0

-1.4

Rs /10 gms

31076.0

-1.6

-3.7

0.0

#N/A

Source: Reuters

Market Highlights - Silver (% change)

Silver Silver (Spot) Silver (Spot -Mumbai) Silver (LBMA) Comex Silver (Dec12) MCX Silver (Dec12) Unit $/oz Rs/1 kg $/oz $/ oz Last
33.4 63550.0 34.3

as on 30 November, 2012 WoW

-2.1 0.5 2.6

Silver
Spot silver fell 2.1 percent week on week taking cues from weakness in the spot gold prices. Doubts amongst global participants as to how the US law makers would solve the fiscal cliff issue is creating bearish market sentiments. Strength in the base metals pack along with positive manufacturing data from the China cushioned sharp fall in the prices. Weakness in the DX also controlled prices from falling sharply. The white metal touched a weekly low of $32.89/oz and closed at $33.4/oz on Friday. In the Indian markets, MCX silver prices declined 3.6 percent and closed at Rs. 61,185/kg on Friday and touched a weekly low of Rs. 60,968/kg. MCX silver prices erased earlier gains of the previous week on the back of appreciation in the Indian rupee and traced bearishness in the spot silver prices. On a weekly basis, holdings in the iShares Silver Trust fell by 0.6 percent to 9,757tonnes till November 30th 2012 from previous week holdings of 9,818 tn till November 23rd, 2012.

Prev day
-2.4 0.5 1.5

MoM
5.0 4.6 7.2

YoY
2.0 10.5 3.0

3320.4 61185.0

-3.3 -3.0

-2.7 -3.7

4.5 3.0

1.6 #N/A

Rs / kg

Source: Reuters

Technical Chart Spot Gold

Outlook
In todays session we expect precious metals to trade on a firm note due to positive global market sentiments along with weakness in the DX. In the domestic markets however, appreciation in the Indian rupee is expected to cap sharp gains in the precious metals on the MCX. Technical Outlook
Unit Spot Gold MCX Gold Feb13 Spot Silver MCX Silver Mar13 $/oz Rs/10 gms $/oz Rs/kg valid for December 03, 2012 Support 1715/1709 31500/31400 33.46/33.30 63000/62700 Resistance 1723/1727 31650/31730 33.78/33.94 63600/63900
Source: Telequote

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Commodities Daily Report

Monday| December 03, 2012

International Commodities
Energy Crude Oil
Nymex crude oil prices gained Nymex crude oil prices gained 0.7 percent. Prices gained due to worries over supply disruptions on account of tension in the Middle East along with positive economic data from the US and Chinese economy. Weakness in the DX also supported an upside in the crude oil prices. Additionally, unexpected decline in the crude oil inventories also added to the gains of the crude oil prices. Towards the end of the week worries over the fiscal cliff issue of the US created doubts over resolution of the same and caused risk aversion amongst market participants and erased most of the gains of the week. Thus, it ended marginally higher. Crude oil prices touched a weekly high of $88.99/bbl and closed at $88.91/bbl on Friday. On the domestic bourses, prices declined 1.3 percent and closed at Rs.4,838/bbl on Friday after touching a low of Rs.4,791/bbl in the last week. Market Highlights - Crude Oil (% change)
Crude Oil WTI (Spot) Brent (Spot) Nymex Crude (Jan13) ICE Brent Crude (Dec12) MCX Crude (Dec12) Unit $/bbl $/bbl $/bbl
88.3 1.3 0.0 3.0 -11.9

as on 30th November,2012 WoW

#N/A 0.0

Last
88.5 111.8

Prev. day
1.0 0.3

MoM
3.4 1.4

YoY
-11.7 1.8

$/bbl
111.2 0.4 -0.1 2.0 2.1

Rs/bbl

4838.0

0.0

-1.4

3.8

#N/A

Source: Reuters

Market Highlights - Natural Gas (% change)

2012 Natural Gas (NG) Nymex NG MCX NG (Nov 12)

as on 30th November,

Unit $/mmbtu Rs/ mmbtu

Last 3.561 195.8

Prev. day -2.38 -3.12

WoW -8.72 -9.39

MoM -3.52 -2.54

YoY 0.31 4.32

Natural Gas
Natural gas prices erased earlier gains of the previous week due to warmer weather and rise in the inventories of the same. However weakness in the DX along with positive data from the US and China cushioned sharp fall in the natural gas prices in the last week. Prices declined 8.72 percent week on week. It touched a weekly low of $3.546 and closed at $3.561 on Friday. In the domestic markets prices declined 9.39 percent due to appreciation in the Indian rupee and traced international prices. Outlook In the intra-day, we expect crude oil prices to trade on a positive note owing to upbeat global market sentiments. Additionally weakness in the DX along with favourable data from the US and Chinese economy is raising hopes that the demand might improve in the coming days. In the domestic markets appreciation in the Indian Rupee will cap sharp gains in the MCX crude prices. Technical Outlook
Unit NYMEX Crude Oil MCX Crude Dec 12 $/bbl Rs/bbl valid for December 03, 2012 Support 88.66/87.74 4820/4770 Resistance 89.77/90.50 4880/4920

Source: Reuters

Technical Chart Nymex Crude Oil

Source: Telequote

Technical Chart Nymex Natural Gas

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Commodities Daily Report

Monday| December 03, 2012

Base Metals

International Commodities
Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (Feb13) LME Aluminum (3 month) MCX Aluminum (Dec12) LME Nickel (3 month) MCX Nickel (Dec12) LME Lead (3 month) MCX Lead (Dec12) LME Zinc (3 month) MCX Zinc (Dec12)
Source: Reuters

The base metal pack traded on a positive note due to firm global market sentiments along with weakness in the DX. Chinas Purchasing Managers Index expanded 50.6 in November thus signalling a faster growth in the nation which also supported an upside in the prices. Apart from this, the Chicago Purchasing Manager also displayed an improvement in the business conditions and stood at 50.4 in November as compared to 49.4 in October. The US economy also expanded at 2.7 percent in the third quarter. In the Indian markets appreciation in the Indian Rupee capped sharp gains in the base metals prices on the MCX.

as on 30th November, 2012 WoW

2.7

Last
7990.0

Prev. day
1.1

MoM
3.3

YoY
2.4

$/tonne

Rs/kg

436.1

0.6

1.2

3.5

#N/A

$/tonne

2088.0

1.4

5.5

8.8

-1.8

Rs /kg

113.7

0.7

4.4

11.5

#N/A

Copper
Copper, the leader of the base metals complex gained 2.7 percent on the optimism that the demand from China would increase as the largest consumer of industrial metal, Purchasing Mangers Index showed growth. The US economy also displayed growth and resolution of the concerns over the Greece aid also supported an upside in copper prices during the last week Additionally, the decline in LME Copper inventories by 0.6 percent also supported the copper prices to rise. LME Copper stocks stood at 2,48,150 tonnes during the week ended in 30th November 2012 from the previous level of 2, 49,825 tonnes in the week ending 23rd November 2012. The metal closed at $7,990 tonne per tonne after touching a weekly high of $8,002 per tonne on Friday. In the domestic markets, MCX copper gained 1.2 percent taking cues from strength in the international prices. In the domestic markets prices of Copper on MCX touched a high of Rs. 436.4 per kg and closed at Rs.436.05 per kg on Friday. Outlook From the intraday perspective, base metal prices are expected to trade with a positive bias taking cues from firm global market sentiments along with weakness in the DX. Favourable data from the Chinese economy is also expected to support an upside in the base metals pack. In the domestic markets, appreciation in the Rupee will however, restrict sharp gains in the copper prices on MCX. Technical Outlook
Unit MCX Copper Dec12 MCX Zinc Dec12 MCX Lead Dec12 MCX Aluminum Dec12 MCX Nickel Dec12 Rs /kg Rs /kg Rs /kg Rs /kg Rs /kg valid for December 03, 2012 Support 438/435 110.4/109.8 121.3/120.5 112.5/111.8 947/940 Resistance 443/446 111.8/112.4 122.5/123.1 113.8/114.5 961/969

$/tonne

17525.0

3.1

5.4

8.9

4.3

Rs /kg

932.6

0.1

1.4

7.9

#N/A

$/tonne

2250.0

1.3

2.2

10.0

7.4

Rs /kg

123.0

0.9

0.9

10.6

#N/A

$/tonne

2054.0

1.5

5.0

10.5

0.7

Rs /kg

110.9

0.6

2.9

13.1

#N/A

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 29th November
248150 5207225 136374 1199175 362275

28th November
249125 5189525 136356 1198100 362350

Actual Change -975 17,700 18 1,075 -75

(%) Change -0.4 0.3 0.0 0.1 0.0

Source: Reuters

Technical Chart LME Copper

Source: Telequote

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Commodities Daily Report

Monday| December 03, 2012

International Commodities
Important Events for Today

Indicator Capital Spending q/y HSBC Final Manufacturing PMI BOJ Gov Shirakawa Speaks Spanish Manufacturing PMI Italian Manufacturing PMI Eurogroup Meetings Manufacturing PMI ISM Manufacturing PMI

Country JPY CNY JPY EUR EUR EUR GBP US

Time (IST) 5:20am 7:15am 9:30am 1:45pm 2:15pm All Day 3:00pm 8:30pm

Actual 2.2% 50.5 -

Forecast 3.7% 50.4 45.9 48.1 51.5

Previous 7.7% 50.4 43.5 45.5 47.5 51.7

Impact Medium Medium Medium Medium Medium Medium High High

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