Mcx Crude oil commodity market had a buying stance yesterday which worked well till late Indian session however the same reversed strongly in the last few hours of trade. Our bullish view was backed by better DoE crude supplies data which fell by 4.27 million barrels last week more than markets expectations. Also refineries operated at higher rate to 93.4percentage whereas on the supply side, imports to the US fell. Nevertheless, we saw a late session sell-off probably on two accounts, Brent continuing to be under pressure on ease in supplies and good fall in equities mainly in the US. Brent Futures were down over 1percentage this week as production in Libya climbed to 925,000 barrels a day, according to National Oil Corp in the country. While at one side international supplies hurt oil, coincidently the technical resistance at $93.60 was met with caution yesterday.
Today morning WTI is seen trading steady. For the day, we would see a very dull period as the commodity may notice a tug-off situation. The positive likely GDP number from the US should help the commodity some support to rebound in the evening however the other weakness over equity markets in Asia today might cast a negative shadow. On the whole, it would be a bit tough state to judge the trade direction wherein on a conservative note we suggest buying the commodity above $93.60 or trade only for momentary calls today.
Global Market View: Sometime on Thursdays we do not need any sound reasons for market to make drastic movements. It just happens that investors across the globe flipped around. We had no major data last day, though whatever we had stayed mostly quiet. The US market plunged wherein different segments of the markets are developing their own theories like overbought phase of the market so it’s time for a profit booking while some are concerned about ending QE programmed by the Fed and mixed performance of equities within the US markets. The bullion gold which has suffered a bruising September beat down rebounded from the losses. We may also say enough of oversold scenario so a good rebounding had to take place which was noticed last late evening on gold. Base metals again tumbled while WTI oil continuously failing to breach $93.60, what’s the deal ahead?’
This morning, both gold and silver are up by 0.22percentage and 0.93percentage at $1224 and $17.60 correspondingly. Oil is managing steady while the base metals are also trading calm. From the global FX front, most of the currencies are quiet this morning. We believe Thursday itself was huge day for so much of movement so possibly today would not be that high volatile. For today’s economic data are concerned, we have a very few- German import price index at 11:30 AM IST and the most important one would be the US 2nd Quarter GDP which is expected to grow by 4.6percentage from the prior number of 4.2percentage. The other data is the US personal consumption which is anyway likely to improve. Note, any further improvement in the US GDP number would make a huge impact in the market.
Natural Gas commodity market has a major cues, the EIA said natural gas stocks increased by 97 BCF, higher than prior figure and mostly in-line with markets expectations of a reading near 96. However, against our view of a price fall and moderately weaker inventory data the commodity extended its gains on back of cues that shutdowns at nuclear power plants that are refueling is indirectly increasing the usage of NG as an alternative fuel for power generation. On other note continued expectations of warmer temperatures in short-term too boosted price outlook. While we are shifting to a ranged view in the commodity today, we still believe 10-15 days fundamental still stay bearish in the commodity. US CPC too in its 8-14 days temperature forecast suggest mostly normal climate in larger part of the US which indirectly calls for a muted demand scenario for the commodity
Sell Copper Mcx Nov below 420 SL 423 Tgt 414
Sell Aluminum Mcx Sep below 119 SL 120 Tgt 118