Daily Market Update Report as on Wednesday, October 03, 2018 Gold prices remained supported in the wake of the U.S. Federal Reserve s plans last week for multiple interest rate hikes by 2020. The Fed raised interest rates last week and said it planned four more increases by the end of 2019 and another in 2020. U.S. consumer spending increased steadily in August, supporting expectations of solid economic growth in the third quarter, while a measure of underlying inflation remained at the Fed s 2 percent target for a fourth straight month. The Fed s Chairman Jerome Powell also discussed trade related issues, adding that the Fed had heard a "rising chorus of concerns from businesses all over the country." He also indicated there was no change in his thinking on monetary policy, although the Fed made an amendment to the statement by removing the use of accommodative to describe its stance on monetary policy. There was much debate about whether removal of that key phrase was hawkish or dovish, but the Fed chief poured some cold water on the speculation. "The change does not signal any change in the likely path of policy," Powell said at his press conference. "Instead it is a sign that policy is proceeding in line with our expectations." Physical demand saw an uptick in the world's biggest gold consumer, China, after prices fell to six-week lows in the week, while discounts narrowed in India as buyers postponed purchases, awaiting a bigger fall. Premiums in China strengthened to $6.5-$8 an ounce from last week's $4-$6. Cheaper gold prices led to increased buying in both Hong Kong and China. Shanghai premiums increased on Friday, reflecting higher demand. Buying remained subdued in India, the second biggest buyer of the precious metal, as buyers delayed purchases. Dealers in India were offering a discount of up to $2 an ounce over official domestic prices in the week, compared to discounts of $5 last week, the highest in three months. India's gold imports more than doubled in August to hit their highest level in 15 months as lower prices prompted manufacturers to replenish inventory for a jewellery exhibition. Hedge funds and money managers raised their net short position in COMEX gold contracts in the week to Sept. 25, U.S. Commodity Futures Trading Commission (CFTC) data showed. They also trimmed their net short position in silver contracts and switched to a net long position in copper futures and options, according to the data. Gold speculators raised their net short position by 2,923 lots to 77,313 lots, the largest in three weeks, according to CFTC data. Hedge funds and money managers cut their net short position in silver by 2,648 contracts to 42,409 contracts, CFTC data showed. Switzerland's gold trade boomed in August, with imports hitting their highest level since January 2017 and exports the highest since June last year, data from the Swiss customs bureau showed. Switzerland, a major trading, vaulting and refining centre for precious metals, said it exported 150.5 tonnes of gold in August, more than twice the amount it shipped in the same month a year earlier. It imported 245.4 tonnes, up from 220.9 tonnes in August last year. Exports to China, the biggest buyer of gold from Switzerland, at 44.3 tonnes were the highest in two months, taking the January-August total to 335.4 tonnes, up from 203.9 tonnes a year earlier. Shipments of 3.3 tonnes to Hong Kong in August were the lowest in four years, but the January-August total of 151.8 tonnes is down by only around 10 tonnes from a year earlier. Date Gold* Silver* 01 Oct 2018 (Monday) 30675.00 37820.00 28 Sep 2018 (Friday) 30450.00 37020.00 27 Sep 2018 (Thursday) 30770.00 37340.00 The above rate are IBJA PM rates * Rates are exclusive of GST 01 Oct 2018 (Monday) Page 1
Outlook: Gold prices edged up buoyed by safe-haven demand as Italy s budget plan sets it on course for a potential clash with the European Union. For the day prices a drop towards 30920-30890 will look to buy with a stoploss of below 30780 expecting prices to jump towards 31060-31220 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 30751.00 30980.00 30683.00 30957.00 177.00 0.58 5.00 154785 7829.00 12054.00 8.26 24132.67 31881.00 29500.00 Resistance 31360.00 31170.00 31063.00 30766.00 30576.00 30469.00 Support Spread FEB - DEC 211.00 APR - FEB 513.00 Gold prices looks to trade with firmness buoyed by safe-haven demand as Italy s budget plan sets it on course for a potential clash with the European Union. Risk appetite was hit after EU officials expressed concerns about Italy s budget plan, which would widen the deficit significantly. The deficit blowout revived fears of the eurozone debt crisis and put pressure on the euro. Italy s government has no intention of leaving the euro, Claudio Borghi, the economics spokesman of the right-wing League, said, clarifying earlier remarks which had roiled financial markets. China s hopes of negotiating a free trade pact with Canada or Mexico were dealt a sharp setback by a provision deep in the new U.S.-Mexico-Canada trade agreement that aims to forbid such deals with non-market countries. Federal Reserve Chairman Jerome Powell said that the U.S. central bank plans gradual increases to interest rates. This could further boost the U.S. currency, making dollar-priced gold more expensive for holders of other currencies, potentially subduing demand. The Fed raised U.S. rates last week and said it planned four more increases by the end of 2019 and another in 2020, citing steady economic growth and a robust jobs market. Investors have also opted to buy the dollar and U.S. Treasury bonds as safe investments instead of gold. Speculators raised their net short position in gold by 2,923 lots to 77,313 lots, the largest in three weeks, in the week to Sept. 25, U.S. Commodity Futures Trading Commission (CFTC) data showed. Technically market is under fresh buying as market has witnessed gain in open interest by 8.26% to settled at 12054, now Gold is getting support at 30766 and below same could see a test of 30576 level, And resistance is now likely to be seen at 31063, a move above could see prices testing 31170. Page 2
INT. GOLD$ Market View Daily Levels Open High Low Close Value Change % Change 1188.84 1207.74 1188.84 1202.86 14.26 0.01 Resistance 1229.69 1218.71 1210.79 1191.89 1180.91 1172.99 Support Outlook: Gold price traded positively today to test the key resistance 1208.40 and keeps its stability below it until now, accompanied by witnessing negative signals through stochastic, which supports the chances of resuming the expected bearish trend on the intraday and short term basis, which depends on holding below the mentioned level, while its targets begin at 1180.00 and extend to 1160.00. Gold prices looks to trade with firmness buoyed by safe-haven demand as Italy s budget plan sets it on course for a potential clash with the European Union. Risk appetite was hit after EU officials expressed concerns about Italy s budget plan, which would widen the deficit significantly. The deficit blowout revived fears of the eurozone debt crisis and put pressure on the euro. Italy s government has no intention of leaving the euro, Claudio Borghi, the economics spokesman of the right-wing League, said, clarifying earlier remarks which had roiled financial markets. China s hopes of negotiating a free trade pact with Canada or Mexico were dealt a sharp setback by a provision deep in the new U.S.-Mexico-Canada trade agreement that aims to forbid such deals with non-market countries. Federal Reserve Chairman Jerome Powell said that the U.S. central bank plans gradual increases to interest rates. This could further boost the U.S. currency, making dollar-priced gold more expensive for holders of other currencies, potentially subduing demand. The Fed raised U.S. rates last week and said it planned four more increases by the end of 2019 and another in 2020, citing steady economic growth and a robust jobs market. Investors have also opted to buy the dollar and U.S. Treasury bonds as safe investments instead of gold. Speculators raised their net short position in gold by 2,923 lots to 77,313 lots, the largest in three weeks, in the week to Sept. 25, U.S. Commodity Futures Trading Commission (CFTC) data showed. Technically now Gold is getting support at 1203.80 and below same could see a test of 1196.20 level, And resistance is now likely to be seen at 1218.20, a move above could see prices testing 1225.00. Page 3
Rupee dropped tracking the surge in crude oil prices amid strong dollar as globally investors expects Fed to hike rates multiple times by 2020. Technically market is under fresh buying as market has witnessed gain in open interest by 5.07% to settled at 2626627, now USDINR is getting support at 72.9925 and below same could see a test of 72.72 level, and resistance is now likely to be seen at 73.3725, a move above could see prices testing 73.48. 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 72.9150 73.2075 72.8275 73.1500 0.3875 0.53 2.51 1836 1989283 2626627 5.07 145325.29 73.5700 64.6000 Resistance 73.68 73.44 73.30 72.92 72.68 72.54 Support Spread NOV - OCT 0.2800 DEC - NOV 0.2800 Rupee dropped tracking the surge in crude oil prices amid strong dollar as globally investors expects Fed to hike rates multiple times by 2020. The Reserve Bank of India said it has decided to buy a total of 360 billion rupees worth government bonds under its open market operations (OMOs) this month, in a bid to ease liquidity conditions in the market. The central bank said the auctions would be conducted during the second, third and fourth week of October. It said the OMO amount stated is indicative and RBI retains the flexibility to change it, depending on the evolving liquidity and market conditions. The RBI s open-market operation announcement followed news when India said it would borrow a gross 2.47 trillion rupees ($34.08 billion) from the market between October and March through dated securities, lower than budgeted estimates. The government will effectively cut its market borrowing by 700 billion rupees due to higher-than-expected earnings of 750 billion rupees through its small savings scheme. The RBI said that its assistance plan followed an assessment of durable liquidity needs and the seasonal growth in currency in circulation ahead of upcoming holiday celebrations. The auctions would be conducted during the second, third and fourth week of October, the RBI said.the 360 billion rupee OMO amount stated was indicative and RBI retained the flexibility to change it, depending on the evolving liquidity and market conditions. Technically now USDINR is getting support at 72.9925 and below same could see a test of 72.72 level, And resistance is now likely to be seen at 73.3725, a move above could see prices testing 73.48. Page 4
Gold Spot 995 Gold Spot 999 Exch. Descr. Last* Exch. Descr. Last* CMDTY Gold 995 - Ahmedabad 31460.00 CMDTY Gold 999 - Ahmedabad 31590.00 CMDTY Gold 995 - Bangalore 31480.00 CMDTY Gold 999 - Bangalore 31630.00 CMDTY Gold 995 - Chennai 31485.00 CMDTY Gold 999 - Chennai 31635.00 CMDTY Gold 995 - Cochin 31485.00 CMDTY Gold 999 - Cochin 31635.00 CMDTY Gold 995 - Delhi 31475.00 CMDTY Gold 999 - Delhi 31625.00 CMDTY Gold 995 - Hyderabad 31460.00 CMDTY Gold 999 - Hyderabad 31610.00 CMDTY Gold 995 - Jaipur 31470.00 CMDTY Gold 999 - Jaipur 31590.00 CMDTY Gold 995 - Kolkata 31575.00 CMDTY Gold 999 - Mumbai 31620.00 CMDTY Gold 995 - Mumbai 31470.00 * Rates including GST * Rates including GST Silver Spot 999 Bullion Futures on MCX Exch. Descr. Last* Exch. Descr. Last CMDTY Silver 999 - Ahmedabad 38600.00 MCX GOLD 04AUG2017 30957.00 CMDTY Silver 999 - Bangalore 38905.00 MCX GOLD 05OCT2017 31168.00 CMDTY Silver 999 - Chennai 38940.00 MCX GOLD 05DEC2017 31681.00 CMDTY Silver 999 - Delhi 38880.00 MCX SILVER 05JUL2017 38445.00 CMDTY Silver 999 - Hyderabad 38950.00 MCX SILVER 05SEP2017 39180.00 CMDTY Silver 999 - Jaipur 38875.00 MCX SILVER 05DEC2017 39661.00 CMDTY Silver 999 - Kolkata 39100.00 CMDTY Silver 999 - Mumbai 38955.00 * Rates including GST Bullion Futures on DGCX Gold and Silver Fix Exch. Descr. Last Exch. Descr. Last DGCX GOLD 28NOV2018 1211.50 CMDTY Gold London AM FIX 1341.05 DGCX GOLD 29JAN2019 1194.50 CMDTY Gold London PM FIX 1341.05 DGCX GOLD QUANTO 29NOV2018 31009.00 CMDTY Silver London FIX 16.45 DGCX GOLD QUANTO 30JAN2019 31186.00 DGCX SILVER 28NOV2018 14.74 Gold / Silver Ratio DGCX SILVER 26FEB2019 14.78 Exch. Descr. Last DGCX SILVER QUANTO 29NOV2018 41189.00 INTL. SPOT GOLD SILVER RATIO 81.61 MCX MCX GOLD SILVER RATIO 80.52 Page 5
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