Commodity Research Report 01 August 2016 Ways2Capital

Page 1


✍ MCX DAILY LEVELS DAILY

EXPIRY

ALUMINIUM

31 AUG 2016

115.20 113.15 111.10 110.35 109.05 108.30

COPPER

31 AUG 2016

CRUDE OIL

19 AUG 2016

GOLD

R4

S2

S3

S4

107

104.95

102.90

346.10 340.40 334.80 332.20 329.10 326.60 323.50 317.80

312.20

2957

R3

R2

2894

R1

2831

2806

PP

2768

S1

2743

2705

2642

2579

05 OCT 2016 32578 32216 31854 31725 31492 31363 31130 30768

30406

LEAD

31 AUG 2016

129.35 126.80 124.25 123.25 121.70 120.70 119.15 116.60

114.05

NATURALG AS

26 AUG 2016

206.80 202.20 197.60 195.30

190.70 188.40 183.80

179.20

NICKEL

31 AUG 2016

753.20 739.10

718.80 710.90 704.70 696.80 682.70

668.60

05 SEP 2016 49378 48707 48036 47758 47365 47087 46694 46023

45352

SILVER ZINC

31 AUG 2016

725

193

160.60 156.80 153.10 151.80 149.30

148

145.60 141.80

138.10

✍ MCX WEEKLY LEVELS WEEKLY

EXPIRY

ALUMINIUM

R4

R3

R2

31 AUG 116.95 114.25 111.55 2016 COPPER 31 AUG 359.30 349.65 340 2016 CRUDE OIL 19 AUG 3627 3363 3099 2016 GOLD 05 OCT 2016 33167 32584 32001 LEAD

R1

PP

S1

S2

S3

110.60 108.85 107.90 106.15 103.4

100.75

334.85 330.35 325.20 320.7 311.05 0 2940 2835 2676 2571 2307

301.40

31798 31418 31215 30835 30252

29669

31 AUG 139.50 133.90 128.30 125.30 122.70 119.70 117.10 2016 NATURALGA 26 AUG 238.80 222.20 205.60 199.30 189 182.70 172.40 S 2016 NICKEL 31 AUG 792.40 764.80 737.20 724.90 709.60 697.30 682 2016 SILVER 05 SEP 2016 54097 51776 49455 48467 47134 46146 44813 ZINC

31 AUG 2016

S4

2043

111.50

105.90

155.80

139.20

645.40

626.80

42492

40171

170.70 163.80 156.80 153.70 149.90 146.70 142.90 136

129

Monday, 01 August 2016


WEEKLY MCX CALL SELL ZINC AUG BELOW 148 TGT 144 SL 152 PREVIOUS WEEK CALL BUY NATURAL GAS JUL ABOVE 188.30 TGT 193.40 SL 182.90 – TGT BUY GOLD AUG ABOVE 31115 TGT 31407 SL 30844 - TGT

✍ FOREX DAILY LEVELS DAILY

EXPIRY

R4

R3

R2

R1

PP

S1

S2

USDINR

29 AUG 2016

67.80 67.65 67.50 67.40 67.35 67.25 67.20

EURINR

29 AUG 2016

75.65 75.35 75.05 74.95 74.75 74.65 74.50 74.20

GBPINR

29 AUG 2016

JPYINR

29 AUG 2016

90 89.60 89.20 88.95 88.80 88.55 88.40

S3

S4

67

66.85

88

69.85 68.15 66.45 65.80 64.80 64.10 63.10 61.40

73.90 87.60 59.75

✍ FOREX WEEKLY LEVELS DAILY

EXPIRY

USDINR

29 AUG 2016 29 AUG 2016 29 AUG 2016 29 AUG 2016

EURINR GBPINR JPYINR

R4

R3

69.15 68.60

R2 68

R1

PP

S1

S2

S3

S4

67.65 67.45 67.10 66.90 66.35

65.80

77 76.20 75.40 75.10 74.65 74.35 73.85 73.10

72.30

91.35 90.50 89.65 89.20 88.80 88.35 87.95 87.10

86.25

70.50 68.55 66.65 65.85 64.70 63.95 62.80 60.85

58.90

WEEKLY FOREX CALL BUY GBPINR AUG ABOVE 89.23 TGT 90.25 SL 88.19 PREVIOUS WEEK CALL BUY GBPINR AUG ABOVE 89.75 TGT 90.67 SL 88.87 - NOT EXECUTED


✍ NCDEX DAILY LEVELS DAILY

R4

R3

R2

R1

PP

S1

S2

S3

S4

DATE SYOREFIDR 20 SEP 2016 642

640

638

636

634

632

630

628

626

3599 3570 3539 3509 3480

3450

5030 5002 4979 4924 4899

4874

JEERAUNJHA 20 SEP 2016 20100 19900 19700 19500 19300 19100 18900 18700

18500

SYBEANIDR RMSEED

TMC GUARSEED

EXPIRY

20 OCT 3695 3662 3630 2016 20 SEP 2016 5106 5080 5055

20 SEP 2016 8544 8472 8410 20 OCT 2016

3941 3902 3867

8352 8307 8271 8232 8197

8166

3833 3800 3770 3740 3710

3680

✍ NCDEX WEEKLY LEVELS WEEKLY

R4

R3

R2

R1

PP

S1

S2

S3

S4

DATE SYOREFIDR 20 SEP 2016 648

644

640

636

633

630

627

624

620

3602 3564 3520 3479 3448

3407

5040 4998 4952 4902 4872

4838

JEERAUNJHA 20 SEP 2016 20400 20100 19900 19600 19200 19000 18700 18400

18000

SYBEANIDR RMSEED

TMC GUARSEED

EXPIRY

20 OCT 3750 3700 3649 2016 20 SEP 2016 5135 5102 5086

20 SEP 2016 8580 8496 8439 20 OCT 2016

3992 3933 3897

8377 8321 8248 8202 8167

8128

3869 3797 3750 3709 3671

3634

WEEKLY NCDEX CALL SELL RM SEED SEP BELOW 4949 TGT 4844 SL 5032 PREIOUS WEEEK CALL SELL DHANIYA AUG BELOW 7600 TGT 7400 SL 7803 - NOT EXECUTED SELL COCUDAKL AUG BELOW 2649 TGT 2588 SL 2711 - TGT


MCX - WEEKLY NEWS LETTERS ✍ GLOBAL UPDATE  The Federal Reserve should be cautious on interest rate increases due to lingering risks to the U.S. economy, one of its most influential policymakers said on Monday, appearing to signal the chance of a hike by the end of the year was fading.   The U.S. Federal Reserve should not overreact to Friday's weaker-than-expected U.S. GDP report, but needs to consider more data before contemplating another interest rate increase, a top Fed policymaker said  Data from the U.S. Commodity Futures Trading Commission (CFTC) that extends back to 2006 showed that money managers, including hedge funds and other big speculators, were holding a record net short, or bearish, position of 5,078 contracts on NYMEX-traded gasoline.  Middle distillates remain the one ray of hope for U.S. oil refiners still struggling to clear a glut of gasoline caused by over-production earlier in the year.

✍ BULLION The U.S. Federal Reserve gave no hints of any near-term interest rate rise as some had expected it to at its monthly policy meeting last week. Early on Monday, New York Fed President William Dudley said the central bank should be cautious on interest rate increases due to lingering risks to the U.S. Economy. Palladium and platinum, however, fared better, hitting their highest in more than a year on improved investor sentiment. The U.S. Federal Reserve gave no hints of any near-term interest rate rise as some had expected it to at its monthly policy meeting last week. Early on Monday, New York Fed President William Dudley said the central bank should be cautious on interest rate increases due to lingering risks to the U.S. economy. Markets will closely monitor this week's data, which includes the monthly non-farm payrolls report on Friday. The US Federal Reserve’s decision has maintained its status quo by not doing rate hike in its recent meeting indicating that the growth in the economy needs to gain further. Besides, The Bank of Japan has announced a modest expansion of its monetary easing programme, blaming Britain’s decision to leave the European Union as the biggest uncertainty facing world markets.

✍ ENERGY A nearly 15-percent slump in U.S. crude prices in July, the worst monthly loss in a year, also triggered liquidation as trading began for August. Monday's slide in crude prices also came after Marathon Petroleum unexpectedly shut its lone crude unit and an associated unit at its 212,000 barrel-per-day refinery in Robinson, Illinois, at the weekend. The cause and duration of the outage were not clear.


Other data from last week showed the United States added 44 oil drilling rigs in July, the most for a month in two years, intensifying concerns that global production could again get to unmanageable levels like in 2014-2015.A nearly 15-percent slump in U.S. crude prices in July, the worst monthly loss in a year, also triggered liquidation as trading began for August. Monday's slide in crude prices also came after Marathon Petroleum unexpectedly shut its lone crude unit and an associated unit at its 212,000 barrel-per-day refinery in Robinson, Illinois, at the weekend. The cause and duration of the outage were not clear. Other data from last week showed the United States added 44 oil drilling rigs in July, the most for a month in two years, intensifying concerns that global production could again get to unmanageable levels like in 2014-2015. Natural gas futures on Friday held mostly steady as forecasts for less hot weather over the next two weeks offset the extremely small weekly storage build seen Thursday. The front-month ended up for a second consecutive week due primarily to Thursday's gain, which was the largest daily percentage rise since late May. Analysts forecast utilities added just 10 billion cubic feet (bcf) of gas into storage during the much hotter-than-normal week ended July 29, the least for that week since at least 2010. That compares with what was a much smaller-than-expected increase of 17 bcf for the week ended July 22, which was also the least for that week since at least 2010, and a build of 41 bcf during the seven days ended July 29 a year ago and a five-year average build for that week of 54 bcf.

✍ BASE METAL Activity in China's manufacturing sector eased unexpectedly in July as orders cooled and flooding disrupted business, an official survey showed, suggesting overall industrial activity remains sluggish at best. A similar private survey showed business picked up for the first time in 17 months, but the increase was only slight. The stainless steel ingredient has been boosted by worries about ore supply from the Philippines, which were reinforced by President Rodrigo Duterte warning mining firms to strictly follow tighter environmental rules or shut down. But analysts say high stocks mean nickel's gains of more than 20 percent so far this year are probably overdone. Reported and unreported stocks, are thought to account for half of global consumption estimated at around 1.9 million tonnes this year. They also expect any shortfall from the Philippines to be covered by higher supplies from elsewhere.Along with this, the Federal Open Market Committee kept its overnight interest rate target in the 0.25 percent to 0.5 percent range although it acknowledged a sharp improvement in the labour market. As a result of Fed and BoJ actions, DX fell be more than 2 percent providing little respite. Earlier this week, the China Banking Regulatory Commission’s (CBRC) proposed crackdown on the $3.5-trillion Wealth management products market state that cash from “mass market” wealth products can only be invested in money or bond markets, not domestically-listed shares. Further, Peru’s energy and mines ministry, MEM, said the country produced 1.12 million fine tonnes of copper, a 51.5% increase from the corresponding period of last year, in the first half of 2016.


NCDEX - WEEKLY NEWS LETTERS ✍ MANSOON UPDATE In line with predictions, the South-West monsoon, the country’s agricultural lifeline, has stayed on course for the first half of the fourmonth season, starting June. The timely and widespread precipitation, after two-successive weak monsoon years, has provided a fillip to crop plantings this kharif season, thereby raising prospects of a good harvest, which has induced a softening trend in prices of many farm commodities. Though the arrival of the monsoon was delayed by about eight days, the swift progress has ensured adequate rainfall across most parts of the country, except pockets such as Gujarat, Kerala and some North-Eastern States. Rainfall in July was 9.8 per cent above normal, while in June it had registered a deficit of 11 per cent. Global models are of the view that for the rest of the season, the monsoon will stay on track, delivering normal to above-normal rains across for many parts of the country. In fact, a long-range forecast for the second-half of the season (AugustSeptember) issued by the India Meteorological Department on Monday said that rainfall is likely to be above normal (106 per cent of the long period average, LPA). The government has no plan as of now to bring back the control raj and re-introduce a release order mechanism to control sugar sales by mills, food minister Ram Vilas Paswan said on Monday. Some media reports recently suggested that the food ministry was mulling such a move to tame rising sugar prices. The government had in 2012 announced the sugar sector “decontrol” by scrapping the release order mechanism through which it used to dictate how much of sugar a mill could sell in a month. It had also abolished the levy system, which mandated that mills would sell 10% of their production to the government at heavily subsidised rates. Listing out the measures taken by the government to help mills clear cane arrears owed to farmers including two subsidised loan packages in times of a crash in sugar prices, Paswan also said the government recently initiated measures to control the price rise in sugar. “We have taken various steps, no curb on mills’ sales, as of now,” he said at the Idea Exchange programme of the Indian Express Group.

✍ SOYABEAN The SOPA has estimated decline of soybean acreage by 2.1% on year to 114 lh in 2016-17 (Jul-Jun). As on 29 July, Indian farmers have planted soybean on 109 lh, up by 2.7 per cent compared to last year sowing data. Higher acreage in Maharashtra, Gujarat, Karnataka, and Telangana has pulled up overall sowing. Madhya Pradesh, the largest grower, have sown the oilseed over 52.6 lh, down 5.2% from a year ago. In Maharashtra, acreage was higher by 14.3% on year at 36.8 lh. In Rajasthan, one of the leading producers of soybean, the sowing area was down by 3.9% on year at 10.2 lh as per respective state government data.soybean futures slipped about 4 percent on Monday on forecasts for favorable weather in the Midwestern crop belt prompted investors to liquidate long positions. Rains continued


across soybean growing areas, which improved soil moisture. Rains should remain abundant across these same areas this week. USDA rated 72 % of the U.S. soybean crop as good to excellent, up from 71 percent the previous week. Government has revised the tariff value for Crude Soy Oil to 765$ /tonne for first half of August against 752$ earlier. Government fixed the tariff value every fortnight. As per SEA data, Import of soyoil during Jun 2016 increased to 386,145 from 178,064 tonnes in May 2016. Moreover, Import of vegetable oils during Jun 2016 is reported at 11.69 lakh tons (lt) compared to 10.04 lt in May 2015, up 16% due to lower international prices. The overall import of vegetable oils during first eight months of the current oil year 2015-16, Nov.’15 – June’16 is reported at 97.6 lt compared to 88.5 lt i.e. up by 10%.

✍ JEERA According to Dept of Commerce data, the exports of Jeera in the first month of 2016-17 increased by more than 50.7% at 13, 525 tonnes compared to last year same month. Moreover, export of jeera during 2015-16 is 93,078 tonnes compared to 1.56 lt exported last year same period. Devaluation of currencies in the buying countries and appreciation of Indian currency combined with high prices have led to a steep decline in jeera exports in 2015-16. As per 4thadvance estimate of Gujarat State for 2015-16, production is pegged at 2.38 lt compared to 1.97 lt in 2014-15. In 2013-14, production was 3.46 lt. Industrial buyers have already sourced sufficient quantity for the domestic requirements but the export demand may pickup due to good demand from China and other countries, as stock levels have been lower. In the next few months, the prices will depend on export demand. On spot market front, at Unjha market, the total arrivals were 6000 bags and the prices hovered in the range of Rs.1940019600/Ql. Stock positions at the NCDEX accredited warehouses are 5442 tonnes and 821 MT are in process as on July 27, 2016.

✍ TMC The Aug’16 delivery contract on NCDEX closed 1.29% higher to settle at Rs 8,154per quintal last week. The arrivals in the main physical markets such as Nizamabad, Duggirala (AP), Salem, Erode and Sangli reported decreasing. There is expectation of lower arrivals and good upcountry demand may lend support in coming weeks. Turmeric acreage in Telangana as on 20-Jul-16 was around 30,000 hectares as compared to 31,000 hectares last year. The acreage is lower compared to normal. As per dept of commerce data, turmeric exports in April 2016 increased by 27% compared to last year at 9,135 tonnes. In 2015-16, 85,426 tonnes exported compared to 90,738 tonnes in 2014-15. Major export destinations in 2015-16 are Iran, Malaysia, UAE, USA and Sri lanka.Higher sowing under turmeric supported by good monsoon over growing region s weighed down the underlying futures market. Hence, Aug futures closed the trade at Rs.8132/ql, down by 0.27% while Sept futures closed with a loss of 0.30%. At Erode market, despite of poor arrivals at 3000 bags, steady trend was


witnessed for finger and bulb at Rs.9100-9300/ql and Rs.8300- 8500/ql respectively. At Sangli market, prices traded in range of Rs.7500-11050/quintal with arrivals at 1800 bags, higher by 940 bags. Around 86% of the normal area is completed with sowing under turmeric in Telangana and is expected to surpass both previous year’s area and normal area in the current season

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