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Weekly Commodity: Commodities behaved wild in the week gone-by

SMC | 15 Nov, 2016  | Follow Author | Add to my Favourites 
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Weekly Commentary


It was a historic week in which we saw a sea change in US politics. Commodities behaved wild accordingly. Market danced on the tune of expectation of result and then actual result. Market appeared nervous when it got a clue of neck to neck fight. For safer side many exchanges increased their margins to tackle with any volatile situations, including MCX. Clear and surprise win of Trump over Hillary Dollar index was on roller coaster ride. It made a low of 95.88 and after clear victory of Trump improved towards 99. Gold had the reverse story. It benefited with the benefits of doubts that there as is a neck to neck fight between two leaders. People parked their money in it and made a massive jump and breached the mark of $1338 on COMEX. Soon after Trump victory, gold prices crashed. Gold also got affected by the ban on 500 and 1000 rupee notes in India. In MCX, it traded in a wide range of 29731-31376 levels. It closed the week in a negative territory after sharp profitbooking. Silver rose with the strength of gold and hold its strength due to major upside in base metals and ignored the fall in gold in latter part of the week. It made a high of 44790 last week. Market witnessed superb performance by industrial metals as there was enthusiasm among the market participants that Trump will pay attention on the real growth of US economy and it spur the demand for industrial metals. Copper led the rally and crossed the mark of 375 in MCX. Energy counter remain trapped in negative territory. Prices fell further as new federal data that showed U.S. oil stockpiles swelled more than expected. Natural gas saw sharp decline for continuous second week on lesser demand.

In agri commodities action was more in oil seeds and edible oil counter. Malaysian palm oil futures traded high, bolstered by a weaker ringgit and concerns that year-end monsoons could disrupt harvests. Gains in soy oil on China's Dalian Commodity Exchange and the Chicago Board of Trade also helped underpin Malaysian palm oil, which competes with soy oil and other products for a share in the global vegetable oils market. Bearish tone was witnessed in spices counter. Wheat saw profitbooking after a continuous four week upside. Cotton counter traded firm.

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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 accept any liability whatsoever arising from the use of any of the above contents.

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