MCX MORNING UPDATES
BULLION – Bullion counter may remain on negative path. Gold prices slipped on Friday, but held near the key $1,500 level amid trade uncertainties and ahead of U.S. Fed chair’s speech for clues on future rate cuts. The market is closely watching Federal Reserve Chairman Jerome Powell’s speech at the Jackson Hole seminar for clarity on monetary policy after minutes of the U.S. central bank’s July meeting tempered hopes of aggressive rate cuts. Underscoring divisions within the Fed, two central bank officials said on Thursday the U.S. economy does not need more stimulus at this point while another said he was “open-minded.” In the U.S. bond market, the two-year, 10-year Treasury yield curve briefly moved back into inversion overnight. It had flashed recession red lights last Wednesday for the first time since before the financial crisis. Traders are also awaiting the Group of Seven summit this weekend for clues on what additional steps policymakers may take to boost economic growth. China has partially lifted restrictions on imports of gold, bullion industry sources said on Thursday, loosening curbs that had stopped an estimated 300-500 tonnes of the metal worth $15-25 billion at current prices from entering the country since May.
ENERGY- Crude oil may trade with positive path as oil prices clawed back the previous day losses on Friday, with Brent nudging above $60 a barrel, as tighter supplies from key producers offset slowing demand growth while investors await clues from the Federal Reserve on U.S. monetary policy. A speech by Federal Reserve Chair Jerome Powell later on Friday t a meeting of central bankers in Jackson Hole is expected to provide some clues on whether the Fed will cut interest rates for a second time this year to boost the U.S. economy. Oil prices are down for nearly two straight months after the International Energy Agency and the Organization of Petroleum Exporting Countries cut demand growth forecasts as a simmering U.S.-China trade war hit global economic growth. However, oil prices remained supported by production cuts from OPEC members and Russia while U.S. sanctions have sharply reduced exports from Iran and Venezuela. U.S. natural gas futures fell on Thursday on forecasts of lower cooling demand over the next two weeks as the peak summer season approaches its end, with prices further weighed down by record high production.
BASE METAL – Base metals may trade on mixed path. Copper prices on the London Metal Exchange (LME) inched up on Friday, following news of progress to resolve the ongoing trade war between the United States and China. U.S. and Chinese trade negotiators held a “very constructive” call on Wednesday and the United States is still planning for a round of in-person talks in September, said White House economic adviser Larry Kudlow. The premium of LME cash nickel over the three-month contract surged to $50 a tonne, its highest since April 2009, indicating nearby supply shortages. Indonesia’s nickel miners association said on Thursday it will continue asking the government to stick to its 2022 timetable for a nickel ore export ban as President Joko Widodo deliberates on possibly implementing the measure earlier.
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