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Weekly Commodity: CRB index regained some strength owing to fresh buying in bullion

SMC | 31 Jul, 2017  | Follow Author | Add to my Favourites 
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Weekly Commentary            

   

Finally, the CRB index regained some strength owing to fresh buying in bullion, energy and oilseeds counter. Dollar index hit ten month low, also stimulated buying in commodities. Gold prices edged up as the U.S. dollar fell to multi-month lows after the prospect for further interest rate hikes in the United States this year dimmed following the softer U.S. economic data last week. Silver prices augmented too. Gold and silver closed near 28300 and 37850 respectively. Crude showed some power play. After the worst June for oil in six years, hedgefund bets on declining WTI retreated. That made room for futures to rebound last week on optimism that the summer will finally boost demand for crude and gasoline. Natural gas prices went above 200 but couldn't stay at higher side on profitbooking. While the doubts persist that OPEC and its allies will manage to bring the oil market back to balance anytime soon. On the other hand, as per the International Energy Agency, world demand is climbing faster than initially estimated. In base metals counter, only copper closed in green territory. London copper hit its highest since early March, supported by a weaker dollar and as an upbeat second quarter for China's economy brightened demand prospects for metals. Stronger than expected Chinese industrial production data increased confidence that global demand would strengthen. Nickel moved high but couldn't stay at higher levels.


Agri commodities danced on the progress of monsoon and the update on acreage area. Chana prices were down as participants trimmed their positions, driven by subdued demand in the spot market against adequate stocks. Mentha prices strengthened on fresh buying though upside was limited on higher supplies from producing regions. International soyabean at CBOT closely following the U.S. weather forecast. Oil seeds and edible oil counter traded firm on strong trend in international market. The wheat market has pulled up commodity prices with hot and dry conditions in the spring growing areas of the U.S. and Canada. Even with winter wheat harvest efforts in the U.S. going well, the narrative has been completely focused on the struggling spring wheat crop. Even in NCDEX, wheat prices closed up despite huge inventory.

 


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About SMC
SMC Research, founded in 1990, is India’s leading share and stock broker, provides a wide range of financial services and investment solutions. A blend of extensive experience, diverse talent and client focus has made us the 4th largest broking house in India(Source: Dun and Bradstreet, 2008). Over the years, SMC has expanded its operations domestically as well as internationally. Existing network includes regional offices at Mumbai, Kolkata, Chennai, Cochin, Ahmedabad, Jaipur, Hyderabad, Bangalore plus a growing network of 2100+ offices spread across 425 cities/towns in India.


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Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor IndiaNotes.com accept any liability whatsoever arising from the use of any of the above contents.



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