MCX MORNING UPDATE
BULLION – Bullion counter may continue yesterday fall. Gold prices dropped over 2% Monday, settling below the psychologically important level of $1,500 to post their lowest finish in two months, as strength in U.S. dollar and some buoyancy in U.S. stocks and yields drew demand away from bullion. G An easing of concerns of an escalation in the US-China trade war took some shine off the safe-haven appeal of gold. China and US will resolve their trade dispute “with a calm and rational attitude”, China’s Vice Commerce Minister Wang Showmen said on Sunday, ahead of talks in two weeks between the two sides. Although the Federal Reserve signaled at its last monetary policy meeting that it is not expecting to change interest rates for the rest of the year. F The central bank is expected to add even more money to the system in coming weeks.
ENERGY- Crude oil may witness lower level buying as U.S. crude futures rebounded in early Asian trade on Tuesday after production at the world largest oil producers fell in the third quarter, partly recovering from a more than 3% drop in the previous session. Output from the Organization of the Petroleum Exporting Countries and Russia fell in September while production from the United States dropped for a third month in July. OPEC output fell to the lowest in eight years in September at 28.9 million barrels per day (bpd), down 750,000 bpd from August revised figure and the lowest monthly total since 2011. Saudi Arabia pumped about 9.78 million bpd in August. Russia output declined to 11.24 million bpd in Sept.
BASE METAL – Base metals may trade with sideways bias. China plans to step up economic adjustments to counter its slowing economy while providing adequate liquidity in the economy, the central bank said on Sunday. Copper slipped on Monday as worries about weak demand due to the prolonged U.S.-China trade war weighed on sentiment, but above-consensus industrial activity data from top consumer China provided price support. China accounts for nearly half of global copper demand, estimated at 24 million tonnes this year. Funds and traders squaring positions for end of quarter book keeping were behind price moves in the afternoon session. The Caixin/Market Manufacturing Purchasing Managers Index (PMI) for September rose to 51.4 from 50.4 in August.