BULLION – Bullion counter may remain on firm path as gold prices edged up on Wednesday as the ongoing trade tensions between the United States and China continued to boost the appeal of safe-haven assets. Goldman Sachs said it no longer expects a trade deal to be struck before the 2020 U.S. presidential election, while Morgan Stanley warned that more tit-for-tat tariffs could tip the world economy into recession by the middle of next year. A Federal Reserve official on Tuesday said it was appropriate to wait and see how upcoming data roll in before deciding whether rates should be cut again at the Fed next meeting in September. SPDR Gold Trust, the world largest gold-backed exchange-traded fund, said its holdings rose 0.21% to 836.92 tonnes on Tuesday from 835.16 tonnes on Monday. Kudlow, director of the White House National Economic Council, said on Tuesday the Trump administration wants to continue trade talks with China and is still planning to host a Chinese delegation for talks in September.
ENERGY– Crude oil may trade sideways to weaker path .Oil prices steadied on Wednesday after falling at the start of the session, with the potential for damage to the global economy and fuel demand from the intensifying Sino-U.S. trade dispute continuing to cast a shadow over the market. Brent prices have plunged more than 9% in the past week after U.S. President Donald Trump said he would slap a 10% tariff on a further $300 billion in Chinese imports starting on Sept. 1, sending global equity markets into a tailspin. Meanwhile, Saudi Arabia Energy Minister Khalid Al-Falih and U.S. Energy Secretary Rick Perry on Tuesday said both sides expressed concern over threats targeting freedom of maritime traffic in the Arabian Gulf as they met in Washington. Tensions in the Middle East have heightened in the wake of attacks on tankers and U.S. drones, raising concerns over passing through the Straight of Hormuz, a key shipping artery of global oil trade. U.S. crude inventories fell by 3.4 million barrels in the week ended Aug.2 to 439.6 million barrels, compared with analyst expectations for a decrease of 2.8 million barrels. U.S. natural gas futures edged up on Tuesday, bouncing off a 38-month low in the prior session on early signs that production will decline, liquefied natural gas exports will rise and power demand in Texas will reach an all-time high this week.
BASE METAL – Base metals may trade on sideways to weaker path. London copper rebounded from a two-year low level hit earlier this week, after a media report said that a senior U.S. official said the Donald Trump administration was still planning for talks with China. Steps taken by Chinese authorities to contain a sliding yuan also helped calm fears of a full-blown Sino-U.S. trade and currency war. China exports probably fell for a second successive month while imports likely contracted more sharply in July, hurt by tit-for-tat tariffs in a rapidly escalating trade war with the United States. Both primary and secondary lead is in deficit, and smelters enthusiasm for production is not good, so supply may be reduced, said a lead smelter.
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