Commodity Tips

MCX Gold is trading in a slightly positive manner today as the commodity is in a recovery mode in the global markets after testing lows under $1700. The Asian equities are trading in an upbeat manner and Gold seems to be witnessing bargain buying after testing one month lows earlier in the week. The COMEX futures are trading at $1703, up $1.2 per ounce on the day.

In overnight moves, COMEX Gold futures yet again edged up from lows under $1690 per ounce and rolled higher by more than 10 dollars in intraday moves amid supportive cues from US stock markets. Prices rebounded following news the European Central Bank cut its economic growth forecast for the European Union.

At its monthly meeting Thursday, the European Central Bank said that Euro zone economic growth would be stagnant to declining during 2013. The ECB projected overall EU economic growth at minus 0.3% during 2013. Just three months ago the ECB projected overall EU economic growth at 0.5% during 2013. That news sunk the Euro currency, boosted the U.S. dollar index and prompted fresh safe-haven demand for gold, to push the metal's price above unchanged on the day.

While this led to a massive jump in the US dollar, which broke under 1.3000 levels against the Euro, Gold remained unfettered from dollar's influence and instead recorded a bounce from lows under $1690 for a second straight day. MCX Gold futures for February tested lows of Rs 31916 per 10 grams yesterday but recovered thereafter, adding nearly Rs 300 in intraday moves.

The counter is quoting at Rs 31236, up Rs 11 per 10 grams on the day. There has been a heavy short selling in current week and a bounce in coming sessions would be witnessed only if some of these shorts are covered. The momentum seems to have turned positive though and will continue to remain so as long as $1700 levels remains protected on COMEX.

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Lower demand in automotive Original Equipment (OE) segment due to slowdown in Indian Automobile Industry remains a vibrant problem for Lead in days to come. This metal has a potential to gain on account of Indian demand but hurdles of higher interest rates and rising petroleum product prices is slowing down consumption.
The inflation numbers in the country is still ruling high and that has forced the Reserve Bank of India to stay away from declining interest rates steadily. One sector that was aiding the lead demand was industrial battery segment. UPS batteries continued to grow robustly this year but the onset of winters is expected to derail this demand as well. The remaining quarter might have to handle subdued demand as UPS and Invertor sales decline in winters.
On MCX, benchmark Lead for December expiry is at Rs 110 per kg. Since testing a low at Rs 99.8 per kg on 29 October, prices are up by 10.2%. LME lead is trading at $ 1981.5 per tonne, up 9% since the start of this year. Demand from North America and rising Chinese automobile sales is pushing the prices higher in international markets.

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Brent oil rose above $108 per barrel as a showdown between Israel and the Palestinians stoked worries about supply, but ample stockpiles supplies and concern about the well-being of the global economy kept gains in check.
Brent for January settlement rose 28 cents to $108.27 per barrel on the London-based ICE Futures Europe Exchange. US oil for December delivery slipped 15 cents to $85.30 per barrel.

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India Crude Steel (million tonnes or mt)
Year	Capacity	Production
2006-07	56.843	50.817
2007-08	59.845	53.857
2008-09	66.343	58.437
2009-10	75.001	65.839
2010-11	80.363	70.671
2011-12*	89.289	73.792
Source: JPC; *provisional

The Minister of Steel, Shri Beni Prasad Verma has said that data on year-to-year change in crude steel production does not indicate any decline. In a written reply in the Rajya Sabha, he added Steel is a de-regulated sector. The Government promotes/encourages growth of steel industry through suitable policy measures based on its assessment of industry performance. Public Sector Undertakings like Steel Authority of India Limited (SAIL) and Rashtriya Ispat Nigam Limited (RINL) have launched their own expansion/modernization programmes to augment steel production capacity and adopt modern technology which is energy efficient, cost effective and environment friendly.

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Gold - Silver The initial decline is still continuing. MCX gold on the lower half per cent is trading at Rs 28 717. The silver half per cent lower at Rs 58 339 level is seen. Comaks on gold - silver business is down.

The initial decline in base metals has increased. MCX is trading at all the metals in the fall. Copper and zinc have been broken half per cent, while aluminum and lead have dropped nearly half a percentage point. The nickel is trading at 0.26 per cent.

Potatoes have gone up strongly today. About 1.5 per cent rise in potato prices on MCX is seen. The price reached around Rs 800. NCDEX stand fast in the potato.

With the introduction of crude oil is up strongly today. About 1.5 per cent rise in the domestic market with crude oil has risen beyond Rs 5,300. Naimaks on the crude oil is trading above $ 108 a barrel.

Decline in the domestic market with the introduction of crude oil is today. With nearly half per cent on MCX gold is trading at Rs 28 797. 58 557 with the silver level of 0.20 per cent being seen. Comaks on gold - silver is a declining trend.

If this declining trend in base metals. All metals except nickel on MCX is trading at in the fall. Although nickel is too sluggish to move. Copper on the LME declined by nearly half per cent.