MCX MORNING UPDATES
BULLION – Bullion counter may trade with weak bias. Gold prices hovered near a four-week low hit in the previous session as risk appetite improved amid hopes of an interest rate cut by the European Central Bank and fiscal stimulus measures from Germany, Europe largest economy. A senior White House adviser tamped down expectations on Tuesday for the next round of U.S.-China trade talks, urging investors, businesses and the public to be patient about resolving the trade dispute between the world two largest economies. Position unwinding was also apparent in bond markets ahead of key central bank policy announcements including the European Central Bank on Thursday and the U.S. Federal Reserve next week. German Chancellor Angela Merkel said on Tuesday her government was sticking to its balanced budget policy, tempering expectations for fiscal stimulus in Europe largest economy.
ENERGY- Crude oil may trade with upside bias as oil prices rose on Wednesday after an industry report showed that crude stockpiles in the U.S. fell last week by more than twice the amount that analysts had forecast. Prices had ended lower on Tuesday, squeezed by speculation of a return of sanctions-hit Iranian crude exports to the market following United States President Donald Trump move to fire national security adviser John Bolton, a noted Iran policy hawk. But they rebounded after American Petroleum Institute (API) data released late on Tuesday showed U.S. crude and gasoline stocks fell last week, while distillate stocks built. The API numbers showed crude inventories fell by 7.2 million barrels in the week ended Sept. 6 to 421.9 million, compared with analysts expectations of a decrease of 2.7 million barrels. U S. natural gas futures eased on Tuesday after setting 14-week highs over the past two trading sessions as a slowdown in liquefied natural gas (LNG) and pipeline exports offset forecasts for warmer weather and rising cooling demand over the next two weeks.
BASE METAL – Base metals may trade with dip lower on profit booking. China’s factory-gate prices shrank at the sharpest pace in three years in August, falling deeper into deflationary territory and reinforcing the urgency for Beijing to step up economic stimulus as the trade war with the United States intensifies. London copper prices dipped in early Asian trade on Wednesday, as the entire base metals complex was pulled down by a stronger dollar and lingering concerns over a slowdown in top consumer China. Refined copper cathode production by major Chinese smelters fell by 0.5% in August from a month earlier. An indefinite strike by mining unions in Peru that started on Tuesday has failed to draw large numbers of workers and has not affected output at mines in the world’s No.2 copper, zinc, and silver producer, an industry association said. Norsk Hydro, one of the world’s largest aluminium producers, said it would close some production in Germany and could lay off more than 700 workers in a bid to increase profitability at its rolled products business.
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