BULLION – Bullion counter may trade with weak bias as gold prices fell on Thursday as equities gained on improving risk sentiment buoyed by signs of gradual de-escalation in U.S.-China trade tensions, while investors eyed European Central Bank’s meeting for cues on monetary policy easing. U.S. President Donald Trump on Wednesday welcomed China’s decision to exempt some U.S. anti-cancer drugs and other goods from its tariffs and announced a delay to scheduled tariff hikes on billions worth of Chinese goods. Trump called on the “boneheads” at the Federal Reserve to push interest rates down into negative territory, a move reluctantly used by other central banks to battle weak economic growth that risks punishing savers and banks’ earnings. The ECB is set to unveil fresh stimulus measures on Thursday to prop up the ailing euro zone economy, but its exact moves are far from certain and a decision that underwhelms markets risks, pushing up borrowing costs. The ECB announces its rate decision at 1145 GMT, followed by ECB President Mario Draghi’s news conference at 1230 GMT.
ENERGY- Crude oil may witness some short covering after yesterday fall. Oil prices jumped on Thursday, bouncing back from heavy losses in the previous session, buoyed by moves to ease trade tensions between Washington and Beijing and a drop in U.S. crude inventories to the lowest in nearly a year. The rise came after China moved to exempt some U.S. anti-cancer drugs and other goods from tariffs, while President Donald Trump announced a delay to scheduled tariff hikes on billions of dollars’ worth of Chinese goods. Boosting the market’s good mood, the U.S. Energy Information Administration said on Wednesday that U.S. crude oil stockpiles fell last week to the lowest in nearly a year, as refineries raised output and imports fell. At 416.1 million barrels, U.S. crude oil inventories were at their lowest since October 2018, and about 2% below the five-year average for this time of year, the EIA said. U.S. natural gas futures slipped on Wednesday from a near 14-week high on forecasts for a little less cooling demand over the next two weeks than previously expected and a continued slowdown in export growth.
BASE METAL – Base metals may trade with upside bias. London copper prices rose as much as 1% in early trade on Thursday, after U.S. President Donald Trump agreed to delay hiking tariffs on $250 billion worth of Chinese goods by two weeks. Copper, considered a bellwether for economic health, fell by 17.7% in London in 2018 and has shed another 2.5% so far this year, weighed down by concerns the Sino-U.S. trade war will hurt demand for industrial metals. Large mining companies on Wednesday welcomed a recent decision by the Indonesian government to move forward a ban on exporting nickel ore, as the firms aim to increase smelting output.
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