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Weekly Commodity: It was a bearish week for commodities counter

SMC | 23 Apr, 2017  | Follow Author | Add to my Favourites 
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Weekly Commentary


It was a bearish week for commodities counter in which many base metals, bullions and energy counter saw fall in the prices. Also the oil seeds and edible oil corner saw a fall. CRB too closed below 185 levels. The London Metal Exchange index of the six major base metals had slid about 7% during April up to Tuesday after the easing of supply problems such as a strike in top copper producer Chile. London copper held close to its weakest since January on Wednesday, on concerns China's base metals demand could temper in the coming quarter as Beijing acts on runaway property prices, and following a wobble in steel. China's refined copper output rose 8.5% in March from a year ago to 764,000 tonnes; it's highest since at least December 2015, while aluminium and iron ore output levels were the lowest in months. On Thursday, copper, zinc and other base metal prices gained as investors, speculators and consumers resumed buying after recent losses, expecting increased seasonal demand. In energy complex, both crude and natural gas moved down on supply gut issue. U.S. oil prices fell nearly 4% on Wednesday, as inventories posted a less-than-expected decline for the week. Surprises build in gasoline inventories despite heavier refining activity, along with an increase in U.S. crude production, largely pushed prices lower. The U.S. Energy Information Administration (EIA) reported that U.S. natural gas stocks increased by 54 billion cubic feet for the week ending April 14, it stimulated selling pressure in natural gas. Gold prices eased, owing to slackened demand from jewellers and customers at the prevailing levels. Silver saw a fall too. The fall was limited as the counter was finding support from a retreat in the dollar and concerns about the North Korea and the French elections.

Edible oil and oil seeds counter performed weak on sluggish demand in spot market. In spices, turmeric saw no respite and saw continuous fall for seventh week on dull demand in spot market. Prices moved below 6200. Jeera prices turned down on profitbooking on higher level. Cardamom and coriander also closed the week on negative territory. Kapas prices revived on lower level buying after a four week fall and ignore the bearish news of record production in Punjab. Sugar prices were marked down on ample stocks following persistent supplies from mills amid scattered demand from bulk consumers.

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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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