MCX MORNING UPDATE
Bullion counter may witness profit booking at higher levels as gold may fall after hitting their highest in more than a week as stocks gained on better-than-expected China factory data and the greenback strengthened, despite fresh uncertainty over a US China trade truce. Gold is traditionally seen as a safe asset in times of political and economic uncertainty. So far this year, gold prices in global markets are up 14% amid the months-long US-China trade spat. Back in India, the recent fall in prices pushed jewelers to replenish their stocks, anticipating a pickup in demand. India’s gold imports in November jumped 78% from a month earlier to the highest level in five months as jewelers in the world’s second-biggest market for the metal restocked after a fall in prices.
Crude oil may witness volatile movement as oil prices edged lower in muted trading on Thursday ahead of the start of OPEC meetings later in the day, steadying after the previous sessions steep gains on a sharp drop in U.S. crude inventories and expectations of more output cuts. Investor attention has switched to meetings of the Organization of the Petroleum Exporting Countries (OPEC) and allies that start later on Thursday, and the possibility of more production cuts. The so-called OPEC+ group has been curbing output since 2017 to counter surging production from the United States, which is now the worlds biggest oil producer. OPEC is aiming to push for deeper reductions in output but needs the agreement of Russia and other oil producers to avoid a supply glut next year, after demand growth slowed in 2019. OPEC members meet in Vienna on Thursday and are then joined by Russia and the other members of the wider grouping on Friday. OPEC+ has been withholding about 1.2 million barrels per day of production.
BASE METAL –
Base metals may trade with sideways to weak bias. Benchmark London copper dipped on Thursday amid skepticism over the chances for a near-term preliminary trade deal between Washington and Beijing, despite U.S. President Donald Trump sounding more positive about the prospects. China warned on Wednesday that U.S. legislation calling for a tougher response to Beijings treatment of its Uighur Muslim minority will affect bilateral cooperation, clouding prospects for a near-term trade deal between the two biggest economies. Brazil Vale SA plans to exit its troubled New Caledonia assets but still aims to ramp up nickel output ahead of rising demand for electric batteries.
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