MCX MORNING UPDATE
Bullion counter may witness further profit booking as gold prices edged lower on Friday, having declined as much as 1% in the previous session, as de-escalation in U.S.-Iran tensions brought relief to markets and boosted investors’ appetite for riskier assets. Markets received a respite after U.S. President Donald Trump responded to Iran’s missile attacks with sanctions instead of military action. The U.S. House of Representatives passed a resolution on Thursday to stop Trump from further military action against Iran, days after he ordered a drone strike that killed a top Iranian commander and raised fears of war. Investors are now focused on a ‘Phase 1’ trade deal signing between Washington and Beijing next week. However, large Chinese purchases of Brazilian soybeans and a pair of unexpected policy moves by Beijing have dimmed U.S. hopes that China would double its imports of American farm products this year.
Crude oil may witness remain on weaker side as oil prices dropped on Friday extending days of losses as the threat of war in the Middle East, a major oil producing region, receded and investors switched their attention to economic growth prospects and demand for crude. Oil prices are below where they were before a U.S. drone strike killed a top Iranian general on Jan. 3, with Iran responding with a ballistic missile attack on Iraqi air bases hosting U.S. forces this week that left no casualties. U.S. natural gas futures on Thursday edged up from a near four-month low on forecasts calling for a little colder weather in late January despite a government report showing a smaller-than-expected storage draw last week. Meteorologists projected the weather in the Lower 48 states will turn to colder-than-usual from Jan. 16-18 before returning to normal through Jan.
BASE METAL –
Base metals may trade with mixed bias. London copper was little changed in early Asian trade on Friday after U.S. President Donald Trump said a Phase 2 trade deal with China may have to wait until the end of the year, tempering bullishness over exchange inventories near a nine-month low. Copper production in Democratic Republic of Congo rose 15.9% year-on-year to 1.308 million tonnes for the period from January to November 2019, according to central bank figures released on Thursday. Copper inventories in LME-registered warehouses fell further to 135,800 tonnes, the lowest since March 12. President Trump on Thursday said his administration will start negotiating the Phase 2 U.S.- China trade agreement soon but that he might wait to complete any agreement until after November’s U.S. presidential election.
Investment & Trading in securities market is always subjected to market risks, past performance is not a guarantee of future performance.CapitalStars Investment Adviser: SEBI Registration Number: INA000001647.