MCX MORNING UPDATE
Bullion counter can witness sideways movement as gold prices were little changed on Thursday as strong U.S. economic data was offset by fears over a rapidly spreading coronavirus outbreak and its impact on the global economy. Positive data from the United States such as the rise in January private payrolls and services sector activity, suggested the economy could continue to grow moderately this year. The U.S. trade deficit fell for the first time in six years in 2019 as the White House’s trade war with China curbed the import bill. Gold (Apr) can dip lower towards 39900 while facing resistance near 40200 while silver (Mar) can test 45600 while resistance near 46200. The World Health Organization played down media reports of “breakthrough” drugs being discovered to treat people infected with the new coronavirus. The China virus outbreak is adding to global economic uncertainty but its impact may be short term and temporary, limiting the need for policy action, top European Central Bank executives said. U.S. President Donald Trump was acquitted on Wednesday in his U.S. Senate impeachment trial, saved by fellow Republicans who rallied to protect him nine months before he asks voters to give him a second White House term.
Crude oil may remain on sideways to upside path as oil futures rose for a second day on Thursday as investors took optimism around unconfirmed reports of possible medical advances to combat the coronavirus outbreak in China as a sign fuel demand could rebound in the world’s biggest oil importer. Prices also gained after a government report on Wednesday showed U.S. gasoline and diesel inventories fell. In the U.S., gasoline stockpiles dropped last week, counter to analysts’ expectations for a gain, and diesel inventories fell more than expected, the Energy Information Administration reported. However, crude stockpiles rose by a more-than-expected 3.4 million barrels last week to 435 million barrels. Commodity supply chains in China have been disrupted to the extent that short-term sales of crude oil, along with liquefied natural gas, fell to nearly zero this week. Crude oil can test 3750 while taking support near 3650. Natural gas can recover towards 137 while taking support near 132. U.S. natural gas futures slipped to near four-year low on Wednesday on forecasts for warmer-than-normal weather and low heating demand over the next two weeks, and a small decline in exports.
BASE METAL –
Base metals may trade with positive bias. The death toll from a new coronavirus in mainland China jumped by 73 to 563 on Thursday, its third consecutive record daily rise, as experts intensified efforts to find a vaccine for a disease that has shut down Chinese cities and forced thousands more into quarantine around the world. China’s exports and imports likely fell in January after a brief rebound at the end of 2019.
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