Daily Market Update Report as on Friday, October 26, 2018

Transcription

1 Daily Market Update Report as on Friday, October 26, 2018 Gold prices inched lower with some investors taking advantage of a recent surge in prices to lock in profits. On Tuesday it hit a more than three-month high of $1, as a global stock market sell-off spurred interest in the metal, which is considered a safer store of value during times of political and financial uncertainty. Gold is pausing for a breath and is probably consolidating for the next possible move higher. Some speculative investors would be in a position to take profit. Gold prices have gained more than 3 percent so far this month, on track to break a six month losing streak, the length of which was last seen in the August 1996-January 1997 period. INDIA SOON TO LAUNCH COMPREHENSIVE GOLD POLICY - In an effort to boost the metal industry and the gems and jewelry sector and create jobs in the gold sector, the Indian government will come out with a comprehensive gold policy soon, Art of Jewellery reports. According to the report, the new policy will likely focus on promoting domestic gold industry and exports of gems and jewelry, which contributes about 15% to total merchandise outbound shipments. Last week, it was reported that gold prices in India have surged to the highest level in more than two years. The rising prices are attributed to a weak rupee and and the fast approach of the celebrations of Diwali and Dhanteras at the beginning of November. India s Gold Buying Season Not Looking as Shiny - Festival season in India normally means one thing: a rush to buy gold. Outside of China, India sees the most amount of gold buying when Indians are, well, happy or enjoying a moment be it a party, a wedding or a festival. But this festive season, starting from around the beginning of October, gold buying has not picked up at the pace one it used to. Reports are coming in that Indians are not flocking to jewelry stores as they normally would for a couple of reasons an increase in the price of domestic gold and the increasing value of the U.S. dollar versus the Indian rupee. Indian gold demand was down from a strong September quarter last year - Indian gold demand was down from a strong September quarter last year, falling 8 per cent to 147.9t due to high local prices and seasonal factors. However, the demand was in line with the long-term average. The y-o-y drop in demand was magnified by the jump in demand seen in last year when consumers rushed to make gold purchases before GST was implemented on 1 July, said a report of the World Gold Council. In a longer-term context, Indian jewellery demand was relatively healthy, just 1 per cent below the five-year quarterly average of 149.1t and 3 per cent higher than average Q2 demand over the preceding ten years (144.1t). Gold jewellery demand failed to perk up in response to the relatively sharp decline in the US $ gold price over the quarter. But currency weakness in many markets meant that local consumers did not benefit from similar gold price reductions. Gold hits over 6-yr high of Rs 32,625 on festive buzz, global cues - Gold prices rose by another Rs 125 to trade at over six-year high of Rs 32,625 per 10 gram Thursday, buoyed by pick-up in festive and wedding season demand by local jewellers amid firm global trends and weakening rupee. Silver, however, remained weak and fell by Rs 130 to Rs 39,600 per kg due to slackened demand from industrial units. Bullion traders said sentiments also got a boost on firming trend in overseas where gold traded at over three-month high as the dollar eased and equities slumped. Besides, weakness in the local currency also added to investor sentiments. Date Gold* Silver* 25 Oct 2018 (Thursday) Oct 2018 (Wednesday) Oct 2018 (Tuesday) The above rate are IBJA PM rates * Rates are exclusive of GST 25 Oct 2018 (Thursday) Page 1

2 Outlook: Gold prices fell on a strong dollar and a rebound of stocks following a multi-day sell-off globally, taking steam out of bullion's momentum. For the day prices a jump towards will look to buy with a stoploss of above expecting prices to drop towards level. MCX GOLD Market View Daily Levels Open High Low Close Value Change % Change Margin Margin (Rs.) Volume Open Interest Cng in OI (%) Prev Value(Mln) 52 Week High 52 Week Low Resistance Support Spread FEB - DEC APR - FEB Gold on MCX settled down -0.16% at on a strong dollar and a rebound of stocks following a multi-day sell-off globally, taking steam out of bullion's momentum. U.S. business spending on equipment appeared to have remained slow in September and the goods trade deficit widened further as rising imports outpaced a rebound in exports, suggesting economic growth moderated in the third quarter. The recent cratering of stock markets is nowhere near severe enough to rattle confidence and significantly hurt U.S. business and consumer spending, a Fed official said, in the latest unruffled message from the U.S. central bank. The government said earlier that the number of Americans receiving unemployment benefits fell to more than a 45-year low, a sign to tight labor market conditions. That will likely keep the U.S. central bank on course to raise interest rates again in December. Richard Clarida, U.S. President Donald Trump s most recent addition to the Federal Reserve Board, made his debut speech on Thursday just days after Trump again slammed the Fed for raising interest rates. His message: rates should continue higher. The European Central Bank stuck to plans on Thursday to claw back unprecedented stimulus, even as the growth outlook continues to darken and political turmoil in Italy looms large over the currency bloc. Italy would need to secure a bailout from the European Union if it is to receive any help from the European Central Bank to bring down its borrowing costs on financial markets, the ECB s President Mario Draghi said. Technically now Gold is getting support at and below same could see a test of level, And resistance is now likely to be seen at 32037, a move above could see prices testing Page 2

3 INT. GOLD$ Market View Daily Levels Open High Low Close Value Change % Change Resistance Support Outlook: Gold price continues to fluctuate at the bullish pennant s resistance, while the EMA50 keeps providing the positive support to the price, to keep the bullish trend scenario active in the upcoming period, depending on the price stability above , reminding you that breaching will open the way to head towards as a next main target. Gold settled down on a strong dollar and a rebound of stocks following a multi-day sell-off globally, taking steam out of bullion's momentum. U.S. business spending on equipment appeared to have remained slow in September and the goods trade deficit widened further as rising imports outpaced a rebound in exports, suggesting economic growth moderated in the third quarter. The recent cratering of stock markets is nowhere near severe enough to rattle confidence and significantly hurt U.S. business and consumer spending, a Fed official said, in the latest unruffled message from the U.S. central bank. The government said earlier that the number of Americans receiving unemployment benefits fell to more than a 45-year low, a sign to tight labor market conditions. That will likely keep the U.S. central bank on course to raise interest rates again in December. Richard Clarida, U.S. President Donald Trump s most recent addition to the Federal Reserve Board, made his debut speech on Thursday just days after Trump again slammed the Fed for raising interest rates. His message: rates should continue higher. The European Central Bank stuck to plans on Thursday to claw back unprecedented stimulus, even as the growth outlook continues to darken and political turmoil in Italy looms large over the currency bloc. Italy would need to secure a bailout from the European Union if it is to receive any help from the European Central Bank to bring down its borrowing costs on financial markets, the ECB s President Mario Draghi said. Technically now Gold is getting support at and below same could see a test of level, And resistance is now likely to be seen at , a move above could see prices testing Page 3

4 Rupee closed at 73.28/$ on Thursday from 73.16/$ on Wednesday technically market is under short covering as market has witnessed drop in open interest by % to settled at while prices up rupees, now USDINR is getting support at and below same could see a test of level, And resistance is now likely to be seen at 73.41, a move above could see prices testing USDINR Market View Daily Levels Open High Low Close Value Change % Change Margin Margin (Rs.) Volume Open Interest Cng in OI (%) Prev Value(Mln) 52 Week High 52 Week Low Resistance Support Spread NOV - OCT DEC - NOV Rupee depreciated on likely outflows from local stocks tracking sell-off in equities across the globe. Indian shares ended lower Thursday as global weakness led across the board selling in the domestic markets. Meanwhile, the greenback remained subdued against its major peers on lack of significant US economic data. The Reserve Bank of India intervention in the foreign exchange market by seeking nationalised banks to sell dollar may limit the appreciation of dollar/rupee around Rs 73.40/$1. The Reserve Bank of India s monetary policy committee sees a risk of rising headline inflation from high crude oil prices and a weak rupee, indicating potential rate hikes ahead even as it held rates unchanged at its last meeting. Minutes of RBI s monetary policy committee s (MPC) October meeting, showed most committee members highlighted the upside risks to inflation while preferring to wait for greater clarity on price pressures. Five of six MPC members had voted for keeping rates on hold at 6.50 percent, surprising most. The panel also shifted its policy stance to calibrated tightening from neutral. Given the flexible inflationtargeting mandate of the MPC, it seems important to signal commitment to keeping to the mandate and move forward carefully at an appropriate time. India s retail inflation rose marginally in September, nudged up by food and fuel prices, but short of the Reserve Bank of India s 4 percent medium-term target, strengthening views it could tighten monetary policy in December following unchanged rates last week. Technically now USDINR is getting support at and below same could see a test of level, And resistance is now likely to be seen at , a move above could see prices testing Page 4

5 Gold Spot 995 Gold Spot 999 Exch. Descr. Last* Exch. Descr. Last* CMDTY Gold Ahmedabad CMDTY Gold Ahmedabad CMDTY Gold Bangalore CMDTY Gold Bangalore CMDTY Gold Chennai CMDTY Gold Chennai CMDTY Gold Cochin CMDTY Gold Cochin CMDTY Gold Delhi CMDTY Gold Delhi CMDTY Gold Hyderabad CMDTY Gold Hyderabad CMDTY Gold Jaipur CMDTY Gold Jaipur CMDTY Gold Kolkata CMDTY Gold Mumbai CMDTY Gold Mumbai * Rates including GST * Rates including GST Silver Spot 999 Bullion Futures on MCX Exch. Descr. Last* Exch. Descr. Last CMDTY Silver Ahmedabad MCX GOLD 04AUG CMDTY Silver Bangalore MCX GOLD 05OCT CMDTY Silver Chennai MCX GOLD 05DEC CMDTY Silver Delhi MCX SILVER 05JUL CMDTY Silver Hyderabad MCX SILVER 05SEP CMDTY Silver Jaipur MCX SILVER 05DEC CMDTY Silver Kolkata CMDTY Silver Mumbai * Rates including GST Bullion Futures on DGCX Gold and Silver Fix Exch. Descr. Last Exch. Descr. Last DGCX GOLD 28NOV CMDTY Gold London AM FIX DGCX GOLD 29JAN CMDTY Gold London PM FIX DGCX GOLD QUANTO 29NOV CMDTY Silver London FIX DGCX GOLD QUANTO 30JAN DGCX SILVER 28NOV Gold / Silver Ratio DGCX SILVER 26FEB Exch. Descr. Last DGCX SILVER QUANTO 29NOV INTL. SPOT GOLD SILVER RATIO MCX MCX GOLD SILVER RATIO Page 5

6 Report is prepared for information purposes only. Kedia Stocks & Commodities Research Pvt Ltd. Mumbai. INDIA. Mobile: / info@kediacommodity.com URL: General Disclaimers: This Report is prepared and distributed by Kedia Stocks & Commodities Research Pvt Ltd. for information purposes only. The recommendations, if any, made herein are expression of views and/or opinions and should not be deemed or construed to be neither advice for the purpose of purchase or sale through KSCRPL nor any solicitation or offering of any investment /trading opportuni. These information / opinions / views are not meant to serve as a professional investment guide for the readers. No action is solicited based upon the information provided herein. Recipients of this Report should rely on information/data arising out of their own investigations. Readers are advised to seek independent professional advice and arrive at an informed trading/investment decision before executing any trades or making any investments. This Report has been prepared on the basis of publicly available information, internally developed data and other sources believed by KSCRPL to be reliable. IBJA and KSCRPL or its directors, employees, affiliates or representatives do not assume any responsibility for, or warrant the accuracy, completeness, adequacy and reliability of such information / opinions / views. While due care has been taken to ensure that the disclosures and opinions given are fair and reasonable, none of the directors, employees, affiliates or representatives of IBJA and KSCRPL shall be liable for any direct, indirect, special, incidental, consequential, punitive or exemplary damages, including lost profits arising in any way whatsoever from the information / opinions / views contained in this Report. The possession, circulation and/or distribution of this Report may be restricted or regulated in certain jurisdictions by appropriate laws. No action has been or will be taken by KSCRPL in any jurisdiction (other than India), where any action for such purpose(s) is required. Accordingly, this Report shall not be possessed, circulated and/ or distributed in any such country or jurisdiction unless such action is in compliance with all applicable laws and regulations of such country or jurisdiction. KSCRPL requires such recipient to inform himself about and to observe any restrictions at his own expense, without any liability to KSCRPL. Any dispute arising out of this Report shall be subject to the exclusive jurisdiction of the Courts in India. Page 6