11/30/2010 06:00:00 PM
Your Advisor
Commodity MCX Trend
Better than expected GDP figures of India announced today helped the domestic equities recover in today’s session. India reported GDP growth of 8.9% in the second quarter, as against 8.8% in the first quarter. However, poor global economic scenario continued to raise concerns in the global equities. Euro zone’s unemployment rate increased to 10.1% in October as against the revised 10.0% in the earlier month. Gold prices gained today, with the MCX December contract gaining around 0.4% in the afternoon trade. Mixed sentiments in the equity markets coupled with ongoing economic issues in the Euro
zone attracted investors towards the yellow metal on the back of safe‐haven demand.
Strength in the US dollar and mixed sentiments in the global financial markets exerted pressure on LME copper prices today. The red metal prices declined round 0.7% on the LME, touching an intra‐day low of $8172/tonne till 3.45 pm IST. Chile’s Collahuasi mine, the world’s third largest copper mine continued its wage talks today signaling the possibilities of strike coming to an end if these negotiations succeed. On the MCX, copper prices gained by more than 0.5% and were hovering at `382.60/kg at 3.45 pm IST. Depreciation of the Indian Rupee helped copper prices to rise on the domestic bourses today.
Crude oil prices were trading lower on the Nymex today, mainly on the back of strength in the dollar and weak sentiments in the global equity markets today.Prices declined by almost 1% on the Nymex and were trading at $84.99/bbl till 3.45 pm IST. On the MCX, oil prices were trading in the green on the back of weaker domestic currency. Spot Rupee depreciated around 0.6%, touching a 11‐week low of 46.11 against the US dollar today.
Analysis/Outlook - The European equity markets are currently trading on a mixed note, but we expect the global equities to end in the red in today’s evening session on the back of economic concerns, especially in the Euro zone. Data on Manufacturing PMI of China is scheduled to be released early morning tomorrow. There are expectations of rise in manufacturing activity in the world’s fastest growing economy. But, considering the poor economic scenario in other developed economies, we expect commodity prices to remain under pressure. Moreover, the US dollar is expected to remain strong in the US session today and this factor will also exert pressure on commodity prices. However, gold prices would be the exception and are expected to trade in the green as safe‐haven demand is expected to drive prices higher.
Commodity NCDEX Trend
Guar Prices closed above its 10-Day and its 20-Day EMAindicating an uptrend.
• 14-days RSI is at 62 and is in neutral region.
• MACD is in the positive territory.
Guar prices may trade firm due to lower carryover stocks and good demand for Guar gum. In the short term (1-2 week)supply pressure due to increased arrivals may be overshadowed by the increased export demand. In the medium termtrend would depend on the pace of arrivals, the demand from the overseas markets and the movement of Indian Rupee against US dollar.
Chana Prices on daily charts closed above its 10-days and its 20-days EMA, indicating an upward trend.
• 14-days RSI is at 71.42 and is in over bought region.
• MACD is in the positive territory.
In the present week, we expect Chana prices to remain firm. However, in the short to medium term (one month), Prices may remain weak due to rising arrivals of Kharif pulses. Long term trend in Chana futures may depend on the reports sowing of Rabi Pulses which is presently expected to be higher due to increase in MSP of Pulses and the climatic conditions prevailing at the time of maturity.
Prices closed above its 10-Day’s and its 20-Day’s EMA Indicating bullish trend.
• 14-Day RSI is at 83.30 and is in overbought zone.
• MACD is in the positive territory.
Turmeric prices in the intraday are expected to trade firm due to lower arrivals and better offtakes at the domestic mandi. Prices in short term (till mid of December), will depend on demand from the domestic and overseas buyers and growth of sown crop. In the long to medium term (December end onwards), prices is likely to take cues from the turmeric stocks and production estimates reported by the spot market participants.
