MCX - WEEKLY NEWS LETTERS
✍ BULLION
Gold rebounded to a fresh three-week high on Friday, as investor risk aversion lifted appetite for the metal, putting it on track for a second straight weekly rise. Often perceived as an insurance against economic and financial concerns, gold has risen more than 2 percent this week after weaker than expected U.S. payrolls data dented expectations of an imminent rise in U.S. interest rates. Prices are likely to be bolstered in the next two weeks by nervousness over Britain's June 23 referendum on its EU membership, analysts said. Gold is highly sensitive to rising interest rates, which lift the opportunity cost of holding non-yielding bullion while boosting the dollar, in which it is priced.Investors have almost priced out the chance of a rate increase at the Fed's June 14-15 policy review and reduced the likelihood of a July increase to about 26 percent. Besides, weak non farm payrolls data and comments from Janet Yellen about gradual rate hike will also act as a positive factor for the yellow metal.Gold prices spurted by Rs 118 to Rs 29,964 per 10 gram in futures trade as speculators widened their bets taking positive cues from the global market. At Multi Commodity Exchange, gold for delivery in far-month October was trading Rs 118 or 0.40% higher at Rs 29,964 per 10 gram in a business turnover of 12 lots. The metal for delivery in August also moved up by Rs 102 or 0.34% to trade at Rs 29,731 per 10 gram in a turnover of 553 lots. Analysts said fresh positions created by participants following a better trend in global market where the precious metal climbed to a three-week high as the dollar retreated on bets the Federal Reserve will keep interest rates on hold in the coming months, supported the upside in gold futures here. Meanwhile, gold traded 1.55% higher at $1,262.50 an ounce in New York in yesterday's trade. Silver prices were sharply up by Rs 441 to Rs 41,415 per kg in futures trade today after participants raised their bets amid firming global trends. At the Multi Commodity Exchange, silver for delivery in far-month September was trading notably higher by Rs 441 or 1.08% to Rs 41,415 per kg in a business turnover of 48 lots Similarly, the white metal for delivery in July traded higher by Rs 428 or 1.06% to Rs 40,682 per kg in a business volume of 758 lots. Analysts attributed the rise in silver prices at futures trade to a firming trend in the precious metals overseas as dollar's safe-haven appeal weakened on bets the Federal Reserve will keep interest rates on hold in the coming months. Globally, silver zoomed 4.07% higher at $17.01 an ounce in New York yesterday.

✍ ENERGY
Crude Oil prices declined by 1.7 percent to close at Rs.3253 per barrel. Crude prices dipped further in Asia on Friday on a stronger dollar, dampening a rally that saw the commodity hitting 11-months high earlier in the week. The losses were in line with a sell-off on equities markets from Asia to the Americas fuelled by worries about the state of the global economy. The greenback was boosted by better than expected US unemployment numbers, making oil more expensive and dampening demand. Traders, however, expect a fresh boost for oil futures if there are new signs of tightening supplies. "If the positive developments we are seeing like the tightening supply (and) increasing demand in the oil sector continue to develop for the next couple of months, then maybe the strengthening US dollar might not have that great an impact," said IG Markets' analyst Bernard Aw. At around 0400 GMT, US benchmark West Texas Intermediate was 15 cents, or 0.30%, down at $50.41 while Brent North Sea crude was 13 cents, or 0.25%, lower at $51.82. Prices have almost doubled since hitting near 13-year lows at the start of the year as US supplies slowly shrink, while production in Nigeria is hit by rebel unrest and Canada's key oil region is ravaged by wildfires.Continuous threats by militants against Nigeria's oil industry and fear of more security incidents that could hit supplies worldwide, however, limited losses in crude. Crude futures have almost doubled since the 13- year lows of $27 for Brent and $26 for WTI in the first quarter. Worries about sabotage of oil facilities in Nigeria, although a build in U.S. gasoline stocks amid peak summer demand could pressure prices. Prices were also supported by data showing China's May crude oil imports at over six-year highs. Natural gas futures on Friday stalled on forecasts the power sector will use a little less gas and more coal over the next two weeks to meet rising air conditioning demand. Traders noted it becomes profitable for some generators to burn coal instead of gas once the gas premium rises over $1 due to coal's higher environmental and transport costs. Despite Friday's decline, the front-month ended up 7 percent for the week, its third straight week of gains. That was the longest weekly winning streak since January. That kept the contract in overbought territory with a Relative Strength Index above 70 for a ninth consecutive day for the first time since December 2013

✍ BASE METAL
Copper prices plunged the most among base metals by 3.8 percent last week to close at $4510 per tonne as 39 percent surge in LME inventories over the past week to above 213,225 tonnes mainly into Asian warehouses, acted as a negative factor. Also, number of Americans filing new applications for jobless benefits declined by 4,000 last week, sign lay-offs remains in check despite a recent slowdown in hiring. Further, European Central Bank President Mario Draghi warned that a lack of economic reforms is making the ECB’s job harder and urged European governments to play a supporting role.
Nickel prices moved up by Rs 4.80 to Rs 603.70 per kg in futures market as speculators raised their bets amid a firming trend overseas and spot demand. At the Multi Commodity Exchange, nickel for delivery in June gained Rs 4.80 or 0.80% to Rs 603.70 per kg in a business turnover of 1,077 lots. The metal for delivery in July rose by Rs 4.80 or 0.79% to trade at Rs 609.70 per kg in 5 lots. Analysts said apart from increased domestic demand from alloy-makers, firmness in the base metals at the London Metal Exchange (LME), influenced nickel prices at futures trade. Globally, nickel added 1.6% to trade at one-month high of $9,050 per tonne at the LME.
Zinc futures was marginally up by 0.22% to Rs 138.80 per kg as participants enlarged positions amid a firming trend at the spot markets today on better domestic demand. At the Multi Commodity Exchange, zinc for delivery in July rose by 30 paise, or 0.22%, to Rs 138.80 per kg, with a business turnover of 14 lots. According to marketmen, a firming trend at at the domestic spot markets following better demand from consuming industries, supported the upside in zinc prices in futures trade but metal's weakness overseas, avoided any major fall in prices. Also, metal for delivery in current month edged up by 25 paise, or 0.18% to Rs 138.35 per kg in business volume of 284 lots.
Aluminium prices edged up by Rs 1.10 to Rs 107.20 per kg in futures trade as participants enlarged their positions, supported by a strong spot demand in the physical market. In futures trading at the Multi Commodity Exchange, aluminium for delivery this month inched up by Rs 1.10 or 1.04% to Rs 107.20 per kg in a business turnover of 316 lots. Likewise, the metal for delivery in July traded higher by Rs 1.10 or 1.10% to Rs 107.95 per kg in 17 lots. Traders said strength in the base metals pack at the London Metal Exchange (LME), spurred by an improving trade outlook in China and monetary stimulus by the European Central Bank and increased domestic demand from consuming industries at the spot markets, helped aluminium futures to trade higher. At the LME, aluminium for delivery in three-month rose 0.7% to $1,614.50 per tonne.




✍ NCDEX - WEEKLY NEWS LETTERS

The monsoon may have been in circulation for only three days after a delayed onset but it has already delivered rain equivalent to, if not more than what the first 10 days of June normally generate. As on Friday, the seasonal rains have covered Kerala, Tamil Nadu, most parts of Karnataka, parts of Rayalaseema and South Coastal Andhra Pradesh. It has delivered normal rain in Kerala and South interior Karnataka but dumped excess rain over Tamil Nadu, Rayalaseema, and coastal Andhra Pradesh. Conditions are favorable for its progress mainly over the peninsular seas over the next three to four days, an India Met Department update said. The Met has forecast heavy to very heavy rain at a few places over coastal Karnataka, South interior Karnataka, Konkan-Goa, and Kerala later today.


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