Metals Daily: Market Overview

Wednesday, December 10, 2014

Market Overview (Economy)

Commodity

Gold / USD Spot

Silver / USD Spot

Crude oil $ Spot

COMEX Copper $

LME Copper (3M)

LME Aluminum (3M)

LME Nickel (3M)

LME Lead (3M)

LME Zinc (3M)

Last

1230.39

17.04

63.74

343.5

6444.25

1968.5

16555

2018

2217.5

Chg

27.59

0.71

0.61

-1.9

-23.25

-3.5

-5

-4.25

-11

% Chg

2.29%

4.35%

0.97%

-0.55%

-0.36%

-0.18%

-0.03%

-0.21%

-0.50%

Asian markets are extending losses on

growth concerns across the globe and

renewed concerns over Greece.

China’s economic data continues to

disappoint with the PPI declining by 2.9%

and annual consumer inflation easing to a

five-year low of 1.4% in November.

The dollar index meanwhile saw some big

profit booking which led the yen and euro

to go higher. Dollar weakness could

support commodities further.

Equity

BSE Sensex Index

S&P CNX NIFTY

Hang Seng Index

Shanghai Index

Nikkei 225 Index

DAX Index

CAC 40 Index

Dow Jones

NASDAQ 100 Index

Last

27797.0

8340.7

23485.8

2856.3

17813.4

9793.7

4263.9

17801.2

4294.7

Chg

-322.4

-97.5

-561.8

-164.0

-122.3

-221.3

-111.5

-51.3

16.3

% Chg

-1.15%

-1.16%

-2.34%

-5.43%

-0.68%

-2.21%

-2.55%

-0.29%

0.38%

Precious Metals

Precious metals are mixed to higher in

early trade following a decline in global

markets as risk aversion took centre

stage.

In Europe, Greece is headed for fresh

elections and concerns over the existing

bailout package could trigger fresh

uncertainty and help precious metals. The

Athens stock exchange was down 12%

yesterday.

Meanwhile, SPDR holdings increased

yesterday by 0.37% to 721.81 tonnes.

Also, Silver Bullion coin sales in the U.S.

have reached 42.9 million coins so far this

year, up from the previous record 42.7

million coins in 2013.

China’s economic data continues to

disappoint with the PPI declining by 2.9%

and annual consumer inflation easing to a

five-year low of 1.4% in November.

Please refer to disclaimer at the end of the report.

Base Metals

Base metals are mostly lower in early trade

following a move up on dollar weakness.

LME copper is lower on ample supply. The global

copper market is expected to swing into a surplus

of about 390,000 tonnes next year, from a fifth

straight year of deficit.

Some support to prices may come as workers at

Peru's biggest copper and zinc mine, Antamina,

will start a new indefinite strike today.

Meanwhile, concerns over Chinese growth and a

big decline in the yuan could keep the overall

sentiment negative for base metals.

MCX Copper rallied sharply yesterday at close

above Rs.406 level. Short-term trend looks

positive above Rs.398 level and the current rally

might extend towards Rs.411-414 range.

LME copper is lower on ample supply. The

global copper market is expected to swing

into a surplus of about 390,000 tonnes next

year, from a fifth straight year of deficit.

LME Inventory

Commodity

Copper

Zinc

Lead

Nickel

Aluminium

Change

950

3200

-2200

-162

-10100

Energy

WTI Oil prices are lower in early trade following

fresh selling after Iraq cuts its OSP to Asia and

the U.S. for January.

It cut its selling price for Asian customers in

January to minus $4.00 a barrel versus the

Dubai/Oman average from minus $2.50 a barrel

in December. The move follows a sharp

reduction to Saudi Arabia's crude oil OSPs last

week.

Meanwhile, adding to supply glut, oil production

from the U.S. is set to keep expanding at the

same pace early next year, according to new

projections. Oil production from the three main

shale plays is set to rise by 103,000 bpd in

January from December.

Key support for MCX Crude Oil is at Rs.3840 -

3880 zone whereas resistance is pegged at

Rs.3985 - 4025. Short-covering moves look

possible as long as above Rs.3880.

Source: Reuters

Meanwhile, adding to supply glut, oil

production from the U.S. is set to keep

expanding at the same pace early next

year, according to new projections.

Please refer to disclaimer at the end of the report.

Level Playing Sheet

Commodity

Gold

Silver

Crude Oil

Copper

Zinc

Lead

Nickel

Aluminum

Exchange

MCX

COMEX

MCX

COMEX

MCX

NYMEX

MCX

Expiry

Feb

Mar

Dec

Jan

Feb

Dec

27159

1232

38521

17.09

3943

63.82

406.40

138.00

125.50

1026.7

121.60

26066

1184

35968

15.94

3822

61.47

393.37

135.20

123.97

1002.4

119.50

26613

1208

37245

16.51

3882

62.65

399.88

136.60

124.73

1014.5

120.55

Pivot

26946

1224

37987

16.85

3935

63.42

404.37

137.40

125.52

1025.3

121.35

27493

1248

39264

17.42

3995

64.60

410.88

138.80

126.28

1037.4

122.40

27826

1263

40006

17.76

4048

65.37

415.37

139.60

127.07

1048.2

123.20

Trend

Bullish

Bearish

Flat

Bearish

Conviction

Moderate

High

Moderate

Range

26780 - 27660

1216 - 1255

37616 - 39635

16.68 - 17.59

3909 - 4022

63 - 65

402.1 - 413.1

137 - 139.2

124.4 - 125.9

1008 - 1031

121 - 122.8

For any details contact:

Commodities Advisory Desk - +91 22 3958 3600

commoditiesresearch@motilaloswal.com

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