MCX MORNING UPDATES
BULLION – Bullion counter may remain on positive path. Gold prices jumped to a fresh six-year high on Monday as the announcement of new tariffs in the escalating Sino-U.S. trade war sent equity markets tumbling, and investors rushing for safehave assets. On Friday, U.S. President Donald Trump announced a 5% additional duty on $550 billion in targeted Chinese goods, hours after China unveiled retaliatory tariffs on $75 billion worth of U.S. products. The markets are fully priced for a quarter-point cut in rates next month, and over 100 basis points of easing by the end of next year. Traders are looking at the Group of Seven summit, where Trump said he wished he had raised tariffs on Chinese goods even higher last week. Hedge funds and money managers increased their bullish stance in COMEX gold and upped net long positions in silver contracts in the week to Aug. 20, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.
ENERGY- Crude oil may trade with positive path as oil prices fell on Monday, pushing U.S. crude to its lowest in more than two weeks, as a ratcheting up of tensions in the U.S.-China war knocked confidence in the global economy. Concerns about an economic slowdown are being fanned by the intensifying trade war between the United States and China. China commerce ministry said late last week it would impose additional tariffs of 5% or 10% on a total of 5,078 products originating from the United States, including crude oil, agricultural products such as soybeans, and small aircraft. U.S. Federal Reserve chair Jerome Powell told an annual economic symposium in Jackson Hole, Wyoming that the U.S. economy is in a favourable place and the Federal Reserve will act as appropriate to keep the current economic expansion on track. U.S. energy firms this week cut the most oil rigs in about four months, with the rig count falling to the lowest since January 2018, as producers cut spending on new drilling and completions. U.S. natural gas futures edged down on Friday on expectations that demand for cooling will slide as the United States approaches the end of summer, while production stood near a record high.
BASE METAL – Base metals may trade on subdued path. China copper futures prices fell to their lowest in three weeks, as base metals weakened due to an escalation in the U.S.- China trade war over the weekend. U.S. president Donald Trump on Friday announced a 5% additional duty on $550 billion in targeted Chinese goods, hours after China unveiled retaliatory tariffs on $75 billion worth of U.S. products. China refined copper cathode imports rose 37.6% in July from the previous month to 292,201 tonnes but was down 8% year-on-year. China also said it will impose an extra 5% tariff on imports of copper scrap and aluminium scrap from the United States from Dec. 15, after already levying a 25% tariff on copper scrap from the United States in a previous round of duties. China Hongqiao, the world biggest aluminium producer, on Friday cut its 2019 production guidance by up to 300,000 tonnes, or almost 5%, after recent flooding on its premises.
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