Expenditure on gold jewellery in Kerala is the highest in the country. But the robust demand has been affected by the floods. In flood-hit areas, the first priority is rehabilitation and gold could be the best asset to encash. There is also a possibility of default on loan against gold pledged by poor and middle class people in the time of crisis like this.
A weaker US dollar and improved market sentiment are expected to continue to buoy copper prices in the short run. With support from fundamentals, the SHFE 1810 contract opened at highs of 48,850 yuan/mt. It closed at 48,710 yuan/mt overnight with a trading range forecasted at 48,600-49,000 yuan/mt today. A surging Chinese yuan is likely to drive LME copper to outperform the contract today. LME copper is seen trading at $6,075-6,130/mt today. We expect spot premiums to extend their
decline to 20-80 yuan/mt as traders destocked.
Oil prices rose on Tuesday as risks of supply disruptions from places such as Venezuela, Africa and Iran triggered expectations of a tightening market. International Brent crude oil futures LCOc1 were at $76.37 per barrel at 0215 GMT, up 16 cents, or 0.2 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures CLc1 were up 9 cents, or 0.1 percent, at $68.96 a barrel. Despite some concerns about an economic slowdown because of the U.S.-China trade conflict, crude supplies are relatively tight due to disruptions as well as voluntary restraints on output by the Organization of the Petroleum Exporting Countries (OPEC).