PPI Final Demand and Commodity Intraday Tips

1
PPI Final Demand and Commodity Intraday Tips
Crude oil commodity market prices rebounded
smartly from its intraday lows wherein at one
point of time, it was down around 2percentage
while finally ended the session higher by around
0.7percentage to 92.90 per barrel mark. While
there is no specified reason for the commodity to
bounce back from its lows other than a probable
technical pullback, other indicators continue to
cast negative shadow over the black liquid. We
saw the US Industrial production data disappoint
heavily meanwhile Chinese cues too continue to
support weakness. If we look at other broad
fundamental perspective, the commodity is weighed
down by ease in global supplies as been the case
lately wherein the impact is witnessed in both
the Brent and the WTI. If we look at the
initial forecasts for the inventory front,
DoE data might show fall in crude
stockpiles by 1.5 million barrels
whereas gasoline stocks too seen
falling marginally. Positive expectations
over inventory may help the commodity not fall
much however weaker equities, ease in oil
supplies and subdued Chinese data points would
continue to hold it down. We recommend selling
the commodity on pullbacks today for small
profits. Note that on a technical perspective
too, prices look for some pullback
initially after which we might register sell.
On that note, we have bought and later sell
recommendation in NYMEX markets today. AT MCX
though, we advice sell at higher level. We hold
our Spread strategy as recommend yesterday. Buy
MCX Oct Sell MCX Sep as weaker demand for the
commodity should reduce the backwardation ahead
of expiry this week. Global Market View
Equities in the US finished on a mixed to weaker
note though we saw huge slide in the Technology
Index, the NASDAQ as probably traders look to
book profits ahead of the crucial two day FED
meeting starting today. Cautiousness prevails in
the Asian equities as well wherein we are seeing
moderate drop in all major indices however in
currency space, the USDX was marginally lower to
84.15 levels while the Euro currency gained
near a similar percentage. As stated
earlier, markets focus this week would
remain on the FOMC meeting wherein
expectations are high that the US central
bank would give a time-line for rising
interest rates in the country. It is also
likely to extend the cut of its
bondpurchase program. Economic Data German and
EU ZEW Economic Sentiment data along with US PPI
report. Note after the disappointing IP number
from US yesterday, we may see some negative
surprise over PPI data.
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Natural gas Commodity market climbed yesterday,
extending its gains from last week. While we held
a range bias in the commodity with negative bias
on expectations that the commodity might look for
fresh triggers over weather, extended warmer
weather outlook in the USC west probably
supported the commodity yesterday. While weather
related changes are depicting a very high
volatility in the US lately, we hold a
cautious stand in the commodity though
still believe, any major positivism in
prices in unlikely. Intraday outlook is seen
ranged. Commodity Intraday tips Sell crude mcx
Sep below 5705 SL 5730 Tgt 5620 Sell Silver mcx
Dec below 41600 SL 41850 Tgt 41300