MCX MORNING UPDATE
Bullion counter may witness some profit booking as gold prices fell on the international market. Gold inched lower on Friday as investors opted for riskier assets after the World Health Organisation stopped short of declaring the China virus outbreak a global emergency, but the precious metal was on track to post a weekly gain. Spot gold fell 0.2% to $1,560.50 per ounce by 0131 GMT. For the week, prices were on track to gain 0.3%. U.S. gold futures slipped 0.4% to $1,559.20. Weighing on bullion, the dollar against a basket of currencies, hovered near a one-month high hit in the previous session after the European Central Bank kept interest rates unchanged at its latest policy meeting. Investors are now focused on the U.S. Federal Reserve’s first meeting of the year scheduled on Jan. 28-29. A significant global upturn will remain elusive this year as many economies still face an array of daunting risks, despite improved sentiment from an initial U.S.-China trade deal and ebullience in financial markets, Reuters polls showed. Holdings of the world’s largest gold-backed exchange-traded fund, SPDR Gold Trust GLD, rose 0.2% to 900.58 tonnes on Thursday.
Crude oil can dip towards 3850 while taking resistance near 4000. Oil prices were steady on Friday, but on track for a fall of up to 5% for the week on growing concern that fuel demand will weaken as the spread of a respiratory virus from China that has killed 25 so far dents travel and darkens the economic outlook. Brent crude futures were 4 cents lower to $62 a barrel by 0225 GMT, its lowest since Dec. 4, after falling 1.9% the previous session. The contract fell 2% on Thursday and is 5% lower for the week. The new coronavirus has infected more than 800 so far in China, with 25 dead as of Thursday, according to China’s National Health Commission. On the supply side, Crude inventories fell 405,000 barrels in the week to Jan. 17, government data showed, less than analysts’ expectations in a Reuters poll for a 1 million barrel drop. Natural gas may consolidate in the range of 135-143. U.S. natural gas futures edged up more than 1% on Thursday from near a four-year low earlier in the week on forecasts for higher liquefied natural gas (LNG) exports and a continued slowdown in production
BASE METAL –
Base metals may trade with weak bias taking negative cues from the international market. Industrial metals also slipped, as oil prices fell more than 2% and Chinese shares registered their biggest decline since May while the yuan also suffered as China put two cities at the epicentre of the outbreak on lockdown. Chinese markets will be closed from Friday to Jan. 31 for the Lunar New Year, reducing liquidity. Copper may dip towards 444-440 while taking resistance near 449. Copper prices fell to their lowest in more than six weeks on Thursday as the rising coronavirus death toll heightened fears over the outbreak’s potential impact on the Chinese economy. Benchmark copper on the London Metal Exchange (LME) ended down 2% at $5,987 a tonne, taking this week’s losses to about 4.5%. swung from a discount of $3.50 on Dec. 11. The premium indicates tighter availability of LME supplies.
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