Commodities Daily Report

Wednesday| February 6, 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:

D Vijiya Rao - Research Analyst vijiya.d@angelbroking.com (022) 2921 2000 Extn. 6134view

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Commodities Daily Report

Wednesday| February 6, 2013

International Commodities
Overview
US ISM Non-Manufacturing PMI declined to 55.2-mark in January. Spanish Services PMI increased to 47-level in the last month. UK's Services PMI increased to 51.5-level in prior month. European Retail Sales declined by 0.8 percent in December.

Market Highlights (% change)

Last INR/$ (Spot) 53.02 Prev day 0.5

as on 5 February, 2013 w-o-w 1.2 m-o-m 3.5 y-o-y -7.5

Asian markets are trading higher today on account of signs of economic recovery in the Euro Zone after favorable economic data in yesterdays trading session. US Institute for Supply Management (ISM) Non-Manufacturing Purchasing Managers' Index (PMI) declined by 0.9 points to 55.2-mark in January as against a rise of 56.1-level in December. Investor's Business Daily (IBD) / TechnoMetrica Institute of Policy and Politics (TIPP) Economic Optimism increased by 0.8 points to 47.3-level in February from 46.5-mark in last month. Indias HSBC Services Purchasing Managers' Index (PMI) increased by 1.9 points to 57.5-mark in January as against a rise of 55.6-level in December. US Dollar Index (DX) declined by 0.1 percent yesterday as a result of rise in risk appetite in the global market sentiments which led to fall in demand for the low yielding currency. Additionally, positive economic data from the Euro Zone showed signs of economic recovery and ease the regions debt crisis along with US equities trading on a positive note which acted as a negative factor for the currency. However, sharp downside in the DX was cushioned on the back of unfavorable non-manufacturing PMI data. The currency touched an intraday low of 79.49 and closed at 79.53 on Tuesday. The Indian Rupee appreciated by 0.5 percent in yesterdays trading session. The currency appreciated in the later part of the trade on account of unexpected rise in the countrys services PMI data. Additionally, rising foreign inflows along with government disinvestment in NTPC Limited also acted as a positive factor for the currency, as around $300-$500 million of foreign inflows is expected from this transaction. However, in the initial part of the trade the currency had depreciated as a result of dollar demand from oil importers and weak global market sentiments. The currency touched an intra-day high of 52.99 and closed at 53.02 on Tuesday. For the month of January 2013, FII inflows totaled at Rs 4,495.50 crores ($844.28 million) as on 5th February 2013. Year to date basis, net capital inflows stood at Rs.26,554.60 crores ($4,903.60 million) till 5th February 2013.

$/Euro (Spot)

1.3582

0.5

0.7

3.8

3.4

Dollar Index NIFTY

79.53

-0.1

-0.1

-1.1

0.4

5956.9

-0.5

-1.5

-0.7

11.1

SENSEX

19659.8

-0.5

-1.7

-0.4

11.0

DJIA

13979.3

0.7

0.2

4.9

8.8

S&P

1511.3

1.0

0.2

3.0

12.4

Source: Reuters

The Euro appreciated by 0.5 percent yesterday on the back of Spanish Services Purchasing Managers' Index (PMI) increased by 2.7 points to 47-level in January as against a rise of 44.3mark in December. European Final Services PMI rose by 0.3 points to 48.6-level in January as compared to earlier rise of 48.3-mark a month ago. Apart from that, upbeat global market sentiments coupled with weakness in the DX also supported an upside in the currency. Italian Services PMI declined by 1.7 points to 43.9-mark in last month from rise of 45.6-level on December. European Retail Sales declined by 0.8 percent in December with respect to rise of 0.1 percent in prior month. Italian Prelim Consumer Price Index (CPI) was at 0.2 percent in January from rise of 0.3 percent in December. The Euro touched an intra-day high of 1.3597 and closed at 1.3582 against dollar on Tuesday. UKs Services Purchasing Managers' Index (PMI) increased by 2.6 points to 51.5-level in January from earlier rise of 48.9mark in December.

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Commodities Daily Report

Wednesday| February 6, 2013

International Commodities
Bullion Gold
Spot gold prices fell around 0.1 percent yesterday on the back of decline in the safe heaven demand for the yellow metal as a result of rise in risk appetite in the global market sentiments. However, weakness in the DX cushioned sharp fall in the gold prices. The yellow metal touched an intra-day low of $1,666.36/oz and closed at $1,671.70/oz in yesterdays trading session. On the domestic bourses, prices declined by 0.5 percent on account of appreciation in the Indian Rupee and closed at Rs.30,153/10 gms after touching an intra-day low of Rs.30,122/10 gms on Tuesday. Market Highlights - Gold (% change)
Gold Gold (Spot) Unit $/oz Last 1671.7 Prev. day -0.1 as on 5 February, 2013 WoW 0.5 MoM 0.8 YoY -2.8

Gold (Spot Mumbai) Gold (LBMA-PM Fix) Comex Gold (April13) MCX Gold (April13)

Rs/10 gms $/oz

30300.0

0.7

-0.2

-0.2

9.7

1673.5

0.5

0.6

1.1

-2.6

$/oz

1672.4

-0.2

-0.4

1.1

-2.9

Rs /10 gms

30153.0

-0.5

-0.3

-2.7

Silver
Taking cues from rise in base metals pack along with weakness in the DX, Spot silver prices increased by 0.2 percent. However, sharp upside in the prices was capped on the back of weak performance in the gold. The white metal touched an intra-day high of $32.12/oz and closed at $31.80/oz on Tuesday. On the domestic front, prices declined by 0.1 percent on account of appreciation in the Indian Rupee and closed at Rs.58,356/kg after touching an intra-day low of Rs.58,052/kg in yesterdays trading session. Market Highlights - Silver (% change)
Silver Silver (Spot) Silver (Spot Mumbai) Silver (LBMA) Comex Silver (Mar13) MCX Silver (Mar13) Unit $/oz Rs/1 kg Last 31.8 59000.0 Prev day 0.2 0.4

Source: Reuters

as on 5 February, 2013 WoW 1.3 1.1 MoM 4.7 1.3 YoY -5.5 6.0

$/oz $/ oz

3201.0 3185.9

1.6 0.5

3.1 2.2

5.3 4.7

-4.5 -5.5

Rs / kg

58356.0

-0.1

0.8

-0.2

Source: Reuters

Outlook
In todays session, we expect bullion prices to trade on a positive note on account of rise in risk appetite in the global market sentiments. Additionally, weakness in the DX will also act as a positive factor for the prices. In the Indian markets, appreciation in the Rupee will cap gains or even add downside pressure on the prices. Technical Outlook
Unit Spot Gold MCX Gold Apr13 Spot Silver MCX Silver Mar13 $/oz Rs/10 gms $/oz Rs/kg valid for February 6, 2013 Support 1667/1661 30490/30380 31.57/31.40 58000/57700 Resistance 1676/1682 30660/30770 31.97/32.20 58750/59150

Technical Chart Spot Gold

Source: Telequote

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Commodities Daily Report

Wednesday| February 6, 2013

International Commodities
Energy Crude Oil
Nymex crude oil prices increased around 0.5 percent yesterday taking cues from signs of economic recovery from Euro Zone after favorable economic data from the region. Additionally, weakness in the DX also supported an upside in the oil prices. Crude oil prices touched an intra-day high of $97.07/bbl and closed at $96.60/bbl in yesterdays trading session. On the domestic bourses, prices traded on a flat note and closed at Rs.5,142/bbl after touching an intra-day high of Rs.5,146/bbl on Tuesday. API Inventories Data As per the American Petroleum Institute (API) report last night, US crude oil inventories rose more than expected by 3.6 million barrels to 371.83 million barrels for the week ending on 1sr February 2013. Gasoline inventories gained around 1.6 million barrels to 233.53 million barrels and whereas distillate inventories declined by 1.4 million barrels to 128.81 million barrels for the same week. EIA Inventories Forecast The US Energy Department (EIA) is scheduled to release its weekly inventories report today at 9:00pm IST and US crude oil inventories is expected to rise by 2.8 million barrels for the week ending on 1sr February 2013. Gasoline stocks are expected to remain unchanged whereas distillate inventories are expected to drop by 1.0 million barrels for the same period. Outlook In todays session, we expect crude oil prices to trade higher on signs of economic recovery in the Euro Zone coupled with weakness in the DX. However, sharp upside in the prices will be capped as a result of expectations of rise in US crude oil inventories. Appreciation in the Indian Rupee will prevent further gains in the crude oil prices on the MCX. Technical Outlook
Unit NYMEX Crude Oil MCX Crude Feb 13 $/bbl Rs/bbl valid for February 6, 2013

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 96.7 118.1 96.6 Prev. day 0.5 0.8 0.5 WoW -1.0 1.4 -1.0

as on 5 February, 2013 MoM 3.7 3.2 3.7 YoY -0.2 1.4 -0.3

$/bbl

116.5

0.8

1.9

4.1

0.5

Rs/bbl

5142.0

0.0

-1.6

0.4

Source: Reuters

Market Highlights - Natural Gas

Natural Gas (NG) Nymex NG MCX NG (Feb 13) Unit $/mmbtu Rs/ mmbtu Last 3.426 178.9

(% change)

as on 5 February, 2013

Prev. day 2.91 0.00

WoW 5.06 1.94

MoM 4.13 -1.16

YoY 36.77 46.88

Source: Reuters

Technical Chart NYMEX Crude Oil

Source: Telequote

Technical Chart NYMEX Natural Gas

Support 96.0/95.40 5110/5080

Resistance 97.10/97.50 5170/5190

Source: Telequote

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Commodities Daily Report

Wednesday| February 6, 2013

International Commodities
Base Metals
The base metals pack traded on a flat note in yesterdays trade on the back of signs of economic recovery in the Euro Zone along with weakness in the DX. While on the other hand, decline in US ISM non-manufacturing PMI added downside pressure on the prices. Apart from that, mixed LME inventories also acted as a negative factor for the prices. Appreciation in the Indian Rupee exerted downside pressure on the MCX. Market Highlights - Base Metals (% change)
Unit LME Copper (3 month) MCX Copper (Feb13) LME Aluminum (3 month) MCX Aluminum Rs /kg 111.5 -0.5 2.7 -1.0 $/tonne 2118.0 0.1 2.6 2.6 -4.5 Rs/kg 442.6 -0.6 1.1 -1.4 $/tonne Last 8288.3 Prev. day 0.0 as on 5 February, 2013 WoW 2.2 MoM 5.6 YoY -2.6

Copper
LME Copper prices traded on a flat note and gained marginally around 0.01 percent yesterday on the back of signs of economic recovery in the Euro Zone along with weakness in the DX. However, sharp upside in the prices was capped on account of rise in LME Copper inventories around 3 percent which stood at 385,050 tonnes. The red metal touched an intra-day high of $8,312/tonne and closed at $8,288.30/tonne in yesterdays trading session. On the domestic front, prices declined by 0.6 percent on the back of appreciation in the Indian Rupee and closed at Rs.442.60/kg after touching an intra-day low of Rs.442/kg on Tuesday. Outlook In todays session, we expect base metals to trade on a positive note on the back of upbeat global market sentiments. Additionally, signs of economic recovery from the Euro Zone along with weakness in the DX also supported an upside in the base metal prices. Appreciation in the Indian Rupee will cap sharp gains in the prices on the MCX. Technical Outlook
Unit MCX Copper Feb13 Rs /kg valid for February 6, 2013 Support 440/438 Resistance 444/446

(Feb13) LME Nickel (3 month) MCX Nickel (Feb13) LME Lead (3 month) MCX Lead Feb13) LME Zinc (3 month) MCX Zinc (Feb13)
Source: Reuters

$/tonne

18743.0

0.5

5.1

8.0

-13.2

Rs /kg

994.3

0.1

4.4

3.9

$/tonne

2462.3

0.4

2.3

5.9

12.5

Rs /kg

130.3

-0.2

1.5

2.3

$/tonne

2179.8

0.0

3.7

7.8

2.1

Rs /kg

115.1

-0.5

3.2

4.2

LME Inventories
Unit Copper Aluminum Nickel Zinc Lead tonnes tonnes tonnes tonnes tonnes 5 February 385,050 5,158,200 150,834 1,199,675 290,000
th

4 February 374,200 5,153,350 150,906 1,202,050 290,075

th

Actual Change 10,850 4,850 -72 -2,375 -75

(%) Change 2.9 0.1 0.0 -0.2 0.0

Source: Reuters

Technical Chart LME Copper

MCX Zinc Feb 13

Rs /kg

114.30/113.50

115.80/116.50

MCX Lead Feb 13 MCX Aluminum Feb13 MCX Nickel Feb 13

Rs /kg Rs /kg Rs /kg

129.40/128.50 110.80/110.0 987/977

131.50/132.50 112.10/112.90 1002/1010

Source: Telequote

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Commodities Daily Report

Wednesday| February 6, 2013

International Commodities
Important Events for Today

Indicator Halifax HPI m/m German Factory Orders m/m Crude Oil Inventories

Country UK Euro US

Time (IST) 1:30pm 4:30pm 9:00pm

Actual -

Forecast -0.2% 0.8% 2.8M

Previous 1.3% -1.8% 5.9M

Impact Medium Medium Medium

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