Daily Metal and Energy Outlook 08th May
BULLION – Bullion counter may trade on sideways to upside bias as gold prices firmed on Wednesday as renewed concerns on U.S.-China trade dispute upset risk appetite, boosting demand for safe-haven assets. Growing fears about the impact on global growth from a worsening U.S.-Sino trade conflict kept the Japanese yen, which like gold is also a safe-haven asset, near its highest since late March. SPDR Gold Trust, the world largest gold-backed exchange-traded fund, said its holdings rose 0.04 percent to 739.94 tonnes on Tuesday from 739.64 tonnes on Monday. International sanctions could be reimposed on Iran if it reneges on commitments under its nuclear deal, sources at the French presidency said on Tuesday, after Tehran said it would scale back its compliance a year after Washington pulled out.
ENERGY- Crude oil may trade with sideways to upside bias as oil prices stabilized on Wednesday as markets remained relatively tight amid U.S. sanctions on crude exporters Iran and Venezuela. The United States re-imposed sanctions on Iran in November last year, demanding all countries stop importing oil from the country. Iran has said it will defy the sanctions and continue to export oil. Crude oil may test 4370 while taking support near 4250. Washington has also slapped sanctions on Venezuelan oil exports, further disrupting crude supply. Wednesday firmer prices partly reversed bigger price falls earlier in the week, which were triggered by announcements from Washington that the United States would this Friday further hike import tariffs on Chinese goods. Natural gas may trade in range of 176- 182 in MCX.
BASE METAL – Base metals prices may trade with upside bias. China’s April exports unexpectedly fell 2.7 percent from a year earlier, while imports grew by a surprising 4 percent, their first increase in months, official data showed on Wednesday. A trade dispute between China and the United States is the main issue causing volatility in metal prices and market participants are braced for stormy conditions to persist. Copper production at Chile’s top mines dropped sharply in the first quarter of 2019, Chilean copper commission Cochilco said on Tuesday, amid a perfect storm of operational issues, heavy rains and falling ore grades at the largest deposits.
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