Gold prices edged lower on Thursday but pared its losses on weak dollar, after data showed that the U.S. economy
GOLD – Gold prices edged lower on Thursday but pared its losses on weak dollar, after data showed that the U.S. economy grew twice as fast as the government originally reported, giving investors reason to hope the Federal Reserve will stick with its plan to hike rates. The third estimate of first quarter growth domestic product showed growth of 1.4%, revised up from the previous reading of a 1.2% expansion and double the initial 0.7% estimate. Real consumer spending for the first three months of 2017 was also revised up more than estimated to 1.1%, from the prior reading of 0.6%. The solid data backed expectations for more U.S. interest rate hikes this year. The Federal Reserve hiked interest rates earlier this month and left the door open for further increases later in the year, though a batch of mixed economic data recently has had investors wondering whether the Fed would be able to stay on its planned tightening path. Futures traders are pricing in around a 20% chance of a hike at the Fed’s September meeting, according to Fed Rate Monitor Tool. Odds of a December increase was seen at about 45%. The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.
NATURAL GAS – U.S. natural gas futures rose to a fresh four-week high on Thursday, extending gains into a fifth session after data showed that domestic supplies in storage rose less than anticipated last week. The U.S. Energy Information Administration said in its weekly report that natural gas storage in the U.S. rose by 46 billion cubic feet in the week ended June 23, below forecasts for a build of 52 billion. That compared with a gain of 61 billion cubic feet in the preceding week, an increase of 37 billion a year earlier and a five-year average rise of 72 billion cubic feet. Total natural gas in storage currently stands at 2.816 trillion cubic feet, according to the U.S. Energy Information Administration, 10.2% lower than levels at this time a year ago but 6.4% above the five-year average for this time of year. Meanwhile, updated weather forecasting models continued to point to increased summer demand in the weeks ahead. Natural gas prices have closely tracked weather forecasts in recent weeks, as traders try to gauge the impact of shifting outlooks on summer heating demand. Gas use typically hits a seasonal low with spring’s mild temperatures, before warmer weather increases demand for gas-fired electricity generation to power air conditioning. Nearly 50% of all U.S. households use gas for heating.
COPPER – London copper punched through a key technical level on Thursday as falling supply and a weaker dollar lifted prices to their highest since April. The U.S. dollar index slid after hawkish comments by the Bank of England added to expectations the European Central Bank would raise rates. A weaker dollar encourages metals demand, making the dollar-priced commodity more affordable for buyers paying with other currencies. LME copper stockpiles have fallen to just under 250,000 tonnes, the smallest since early March and down by nearly 100,000 tonnes since early May. China on Tuesday appointed a new environment minister who has promised a “protracted battle” to clean up the nation’s notoriously polluted air, water and soil. LME lead also approached three-month highs as mine supply shrinks and China imports more metal. There is one party holding between 40-50 percent of LME lead stocks, while there is a large short position of between 20-29 percent of outstanding futures positions in the July contract, LME data shows. A ban on open-pit mining in the Philippines enforced by a former environment minister has “no legal basis” and is under review, a senior government official said. A reversal of the ban could undermine nickel prices which remained up 0.7 percent up $9340 a tone.
Investment & trading in securities market is always subjected to market risks, past performance is not a guarantee of future performance.
CapitalStars Investment Adviser: SEBI Registration Number: INA000001647
Our Some Best Services Read it Here…