MCX - WEEKLY NEWS LETTERS
✍ GLOBAL UPDATE

U.S. drillers this week added oil rigs for a fifth week in six, according to a closely followed report Friday, prompting analysts to predict the rig count has bottomed and production will start to edge up early next year.

U.S. job growth surged in June as manufacturers and other employers boosted hiring, confirming the economy has regained speed after a first-quarter lull, but tepid wages suggested the Federal Reserve will probably not raise interest rates soon. Nonfarm payrolls increased by 287,000 jobs last month, the largest gain since last October, the Labor Department said on Friday. May payrolls were revised sharply down to show them rising 11,000 rather than the previously reported 38,000.

The U.S. created 287,000 jobs in June, massively topping analyst expectations. The national unemployment rate, meanwhile, rose slightly more than expected in June, to 4.9 percent, according to data released Friday by the Bureau of Labor Statistics. Jobs watchers had been expecting Friday's jobs report to show a substantial rebound from May's unexpectedly weak growth, but the June number easily topped expectations. Economists surveyed by Reuters said they were, on average, expecting nonfarm payrolls to show growth of 175,000 for June, and the unemployment rate to rise to 4.8 percent.

Bank of Japan Governor Haruhiko Kuroda said the central bank is ready to expand monetary stimulus further if needed to achieve its 2 percent inflation target, but made no mention of the Brexit vote that has spread turmoil in financial markets. Kuroda maintained the central bank's optimistic view on the economy, signalling his confidence over Japan's recovery prospects. "Japan's economy is expected to expand moderately as a trend," Kuroda said in a speech delivered at a quarterly meeting of the central bank's regional branch managers on Thursday.

✍ BULLION
Gold prices rose by 0.8 percent to close at Rs.31719 per 10 gms last week..Gold slipped sharply on Friday after stronger than expected U.S. payrolls data for June but rebounded quickly, underpinned by concerns over the outlook for financial markets following Britain's Brexit vote. Gold hit a low of $1,335.66 an ounce in the wake of data showing that U.S. non-farm payrolls increased by 287,000 jobs last month, the largest gain since October. That sent the dollar to a two-week high against the euro and reignited talk that the U.S. Federal Reserve could lift interest rates this year. Traders had awaited the payrolls data for clues on U.S. monetary policy. Fed futures contracts, which suggested before the jobs report that traders saw only a 19 percent chance of a U.S. rate hike by December, now suggest a higher chance. Lower rates tend to boost gold prices because they cut the opportunity cost of holding non-yielding bullion while weighing on the dollar, in which it is priced. SPDR Gold Trust GLD, the world's largest gold-backed exchange-traded fund, said its holdings fell by a little more than four tonnes on Thursday to 978.29 tonnes, having posted its biggest daily inflow in six years on Tuesday. The world's largest gold-backed exchange-traded fund, SPDR Gold Trust, posted the biggest one-day surge in its holdings in more than six years on Tuesday. They jumped 28.8 tonnes to 982.72 tonnes, their highest since June 2013. The minutes of the US Federal Reserve released stated that the uncertainty over the so called Brexit will limit any further move by the central bank about rate hike.

✍ ENERGY
Oil prices declined by 6.5 percent to close at Rs.3059 per barrel.Oil broke support levels after the Energy Information Administration (EIA) said crude stockpiles fell 2.2 million barrels for the week to July 1, just below a 2.3-million barrel decline forecast by analysts in a Reuters poll. While the EIA reported a seventh weekly decline in crude stocks, the figure it gave was far less than a 6.7 million-barrel draw cited by trade group the American Petroleum Institute in preliminary data issued late Wednesday.The oil market initially rose about 1 percent or more after the U.S. economy posted the largest job gains in eight months in June and on worries about fresh militant attacks on Nigerian oil infrastructure. Oversupply concerns, however, resurfaced with data showing the U.S. oil rig count rose by 10 this week as drillers added rigs for a fifth week in six as analysts to predict the near two-year slump in drilling has bottomed and production will start to edge up early next year. Both benchmarks were down nearly 8 percent for the week - the largest weekly slide for Brent since January and the biggest weekly drop for WTI since February. Crude futures remain some 75 percent above 12-year lows of $27 for Brent and $26 for WTI hit in the first quarter. But the market has gyrated since hitting above $50 as a glut of refined products replaced worries about crude oversupply that caused a near two-year long tumble earlier. Futures hit two-month lows on Thursday, with WTI breaking below key support of $45.83 after weekly drawdowns in U.S crude looked inadequate to assuage investor concerns.
Natural gas futures fell for the first week in seven despite a small gain on Friday on forecasts for hotter-than-normal weather to persist through at least late July. After soaring 45 percent over the prior six weeks on the summer heat which began in early June, gas futures lost 6 percent in the July Fourth holiday-shortened week as traders took profits on Tuesday. With the hottest weather of the year expected in mid-July, some traders said futures could climb over $3 in coming weeks. Others, however, noted the heat was already priced in and predicted the frontmonth could fall to $2.50 on the first signs of cooler temperatures. In early estimates, analysts forecast utilities added 64 billion cubic feet of gas into storage during the week ended July 8. That compared with builds of 39 bcf in the prior week, 95 bcf a year earlier and a five-year average of 77 bcf.

✍ BASE METAL
Copper prices traded lower by 4.6 percent last week to close at Rs.317.8 per kg.Copper prices plunged the most by 4.1 percent last week to close at $4710.5/tonne as Non-farm payrolls increased by 287,000 jobs last month, that's its biggest gain since last October, and above forecasts of 175,000. Earlier, private processing firm ADP showed U.S. Payroll said nonfarm private employment rose 172,000 last month. Also, investors were a cautious after an influx of inventories into warehouses. Data showed an inflow of 23,625 tonnes of metal into London Metal Exchange-approved warehouses on Tuesday, the latest arrival into depots that have seen a 45 percent surge since June 1. However, sharp losses were restricted as investors were keenly awaiting host of stimulus measures from China and other major economies after weak manufacturing data from the biggest consumer. The market still needed more clarity, however, about global economic growth and metals demand, some which would come when economic figures from top metals consumer China are released next week, he added. A weaker dollar makes dollar-priced commodities cheaper for buyers using other currencies. LME nickel climbed 1.4 percent to end at $9,890 a tonne, recovering from a session low of $9,525 after the Philippines ordered the suspension of operations at two nickel mines in an environmental crackdown. The Philippines is the biggest supplier of nickel ore to China. Peter Peng, an analyst at CRU consultancy in Beijing, said the two mines are relatively small and unlikely to have any immediate impact on shipments to China.

NCDEX - WEEKLY NEWS LETTERS
Monsoon rainfall last week was 35% above what is touted to be normal, helping kharif sowing to exceed last year’s level in case of rice, pulses and sugarcane, although the overall sowing level was still 6% lower than a year ago, reports Sandip Das in New Delhi. Rains during the current season, which remained below normal until over a week ago, turned slightly above normal: As on July 7, the rains were 1% above the benchmark long-period average. This has also improved water levels in 91 large reservoirs, although the storage continue to be significantly lower than this time last year. Analysts say that the sowing of kharif crops like paddy, pulses and oilseeds have picked up pace because of widespread rainfall. According to ministry of agriculture data released on Friday, the sowing was lagging by 23% last week.

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