MCX - WEEKLY NEWS LETTERS
INTERNATIONAL NEWS
✍ Bullion
Gold prices approached near 13 months high in the early morning trade today after rallying 1.22% in yesterday’s trade at COMEX. The prices recovered their intra day losses yesterday after the Euro recovered sharply against the dollar post the comments from the ECB president that there might not be any further rate cuts. Earlier it lowered deposit rates by 10 basis points to -0.4 percent and expanding its asset purchasing programme to 80 billion Euros per month to avoid another recession. The programme will run until at least March 2017. The US dollar index tumbled to a month’s low of 95.94 overnight. SPDR Gold Trust, the world's largest gold-backed exchange traded fund, said its holdings rose to 25.68 million ounces on Thursday, the highest since August 2014.
Investors continued to remain bearish on gold exchange-traded funds (ETFs) as they pulled out around Rs 800 crore from the instrument during the first 11 months of the current fiscal. As things stand now, FY16 will mark the third consecutive financial year of outflow from gold ETFs. The pace of outflow, however, slowed down in 2015-16 as against the preceding two years on account of sluggish equity market, experts said.Gold ETFs witnessed a net outflow of Rs 798 crore in the first 11 months (April-February) of the ongoing fiscal compared to an outflow of Rs 1,364 crore during the same period of 2014-15 fiscal. These funds witnessed outflow of Rs 1,475 crore in entire 2014-15 and a withdrawal of Rs 2,293 crore in 2013-14. However, the asset base of gold funds marginally increased to Rs 6,672 crore in February 2016 from Rs 6,665 crore at the end of March 2015. The mutual fund sector has 14 gold-based schemes, which have been in the market since 2006-07. The demand for gold ETFs has been steadily falling in the past few years. These products have seen outflow as gold prices are correcting and equities have given good returns to investors. Retail investors have been putting in more money into equity and debt mutual funds during April-February. Equity and equity-linked saving schemes saw an infusion of Rs 75,394 crore and debt funds attracted about Rs 20,000 crore. Overall, mutual fund schemes have witnessed an inflow of Rs 2.07 lakh crore during the period under review.

In 2016, the allure for the yellow metal as an asset class is back, as spot gold prices in the international markets have risen 18 per cent and comex gold has increased 18.5 per cent. On the MCX, gold prices have gone up 18.7 per cent. Spot gold prices (Ahmadabad) have also gained 18 per cent in the same time frame. Fall in global equities, inflows into bullion funds, weak dollar index and concerns over financial instability have been important factors for the recent rise. Besides, the metal has been helped by speculation that the Federal Reserve might not raise US interest rates this year, after the first rate hike in nearly a decade in December 2015. Since the beginning of 2016, gold holdings in the SPDR Gold Trust have already surpassed the whole of 2015. In absolute numbers, gold holdings as on March 7, stood at 793 tonnes, an increase of 151 tonnes compared to December 31, 2015. Besides, Barrick Gold Corporation, the world's largest gold producer, has also cut its 2016 total gold production forecast, boosting prices. Although most of the Federal Open Market Committee policymakers are still expected to raise rates this year and even discussed a hike at the January 26-27 policy meeting, they were divided over how to interpret financial market volatility. The next meeting scheduled on March 15-16 will be closely watched by investors across the globe, as it will provide clues on further rate hikes.

Amid a weakening trend overseas, silver prices fell Rs 297 to Rs 37,130 per kg in futures trade today as speculators cut down their bets. Silver for delivery in May was trading lower by Rs 297, or 0.79 %, to Rs 37,130 per kg in a business turnover of 650 lots in futures trading at the Multi Commodity Exchange (MCX).On similar lines, the white metal for delivery in far-month July was down by Rs 262, or 0.69 %, at Rs 37,613 per kg with a business turnover of 11 lots. In the international market, silver traded 0.62 % lower at $15.23 an ounce in Singapore. Market analysts said, a weak trend in precious metals in global markets as the dollar gained ahead of a key European Central Bank meeting this week eroding demand for the precious metal, kept pressure on silver futures here.

✍ Energy
Crude oil prices showed a decline from their highest levels attained this year as the anticipations for 20th March meeting is fading away. With third straight weekly decline in gasoline stocks, signal for some improved demand at the time of summer driving season has suppported crude prices. Recently, gasoline prices hit their multi year low levels in the US region as the demand was too low along with lower crude oil prices. As per recent updates, gasoline now is just 58 cents less compared to last year’s average. Apart from this, the shale production in USA was flat last week. US crude oil production is now standing at 9.10 mbpd compared to 9.60 mbpd levels in mid 2015.
Natural Gas futures jumped 3 per cent in the domestic market on Friday tracking a bullish trend overseas amid speculation that lower prices of the fuel which has witnessed a bearish ride off late, may encourage lower production and boost demand. US natural gas rig count fell to a record low last week, down by 3 to 94, signaling lower production ahead. However, supply levels remain more than adequate with total US natural gas storage 36.8 per cent higher than levels at this time a year ago and 29.4 per cent above the five-year average for this time of year. At the MCX, Natural Gas futures for March 2016 contract closed at Rs 123.3 per mmBtu, up by 3 per cent, after opening at Rs 120.4, against the previous closing price of Rs 119.7. It touched an intra-day high of Rs 124.4.

✍ Metal
Benchmark copper on the London Metal Exchange ended down 0.9 percent at $4,890, while three-month aluminium was down 1.5 percent at $1,559 a tonne, zinc slipped 1.8 percent to $1,765, lead fell 1.5 percent to $1,818, tin lost 1.0 percent to $16,625 and nickel ceded 1.4 percent to $8,755 as the demand concerns resurfaced and Chinese equities sagged. The global refined copper market is expected to remain "essentially balanced" in 2016 compared with a previous forecast in October for a 175,000 tonne surplus, the International Copper Study Group (ICSG) said on Thursday, despite which the metal is all set to end the week on a negative note after four weeks of positive closing.

For Quick Trial – 08962000225
Or mail us here: [email protected] or visit http://www.ways2capital.com/free-trial.php
Contact 0731-6554125
Toll Free – 1800-3010-2007
Give a Missed Call for Free Trial - 09699997717
For Reports And Tracksheets - http://www.ways2capital.com/downloads.php