Weekly Commodity News-

 

India gold demand may weaken as govt doubles customs duty - 19/Mar/2012 – 24/Mar/2012

India's gold demand may weaken further on account of higher import duties. India has doubled the customs duty on Gold to 4% while doubling the customs duty on Jewellery to 10%, Finance Minister Pranab Mukherjee said as part of his presentation of the Union budget. The increase in duties is seen as a move by the Finance Ministry to reduce the burgeoning fiscal deficit of the country. Various industry bodies like the ASOCHAM had advised the Indian government to implement measures to reduce India's fiscal deficit.

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In the beginning of 2012, the govt had raised the import duty on gold from Rs 300/10gms to 2% of the value of imported gold and now with the doubling of customs duty on gold and jewellery, consumers may have to yet again face the prospect of higher prices and this could dissuade them to make increased purchases. India's gold imports had dropped by over 40% in Q4, 2011 due to high prices and the Bombay Bullion Association (BBA) president Prithviraj Kothari had said that Indian demand will weaken further unless prices fall. As such, the hike in excise duty could do just that- reduce Indian imports.

China crude oil imports hit record high in February amidst wide trade deficit - 19/Mar/2012 – 24/Mar/2012

Crude oil imports by China rose to 23.64 million metric tonnes in February, latest data released by the General Administration of Customs shows. China is the second largest consumer of crude oil in the world. February's increased imports are 18.5% gain over February 2011 import figures and represents its highest monthly level on record. This has however widened the trade deficit. Despite the jump in oil imports, a recent report by the International Energy Agency (IEA) notes that Chinese oil demand growth will weaken in 2012 given that the country is projected to grow less than 8% this year.

 In fact, the report says that China's share of global oil demand growth will shrink to 45% in 2012 compared to 60% in 2011. China's February trade deficit at $31.5 billion was its biggest ever since 2000 and incited fears amongst investors that the Chinese economy may have run out of steam. Since China is dependent on its exports, the huge fiscal deficit points to the country's weakening revenue stream. Considering that Europe is China's biggest export market, it should not come as a surprise that the slowdown in Euro nations has affected the Chinese as well.

Chinese copper imports to drop substantially in March and April- 19/Mar/2012 – 24/Mar/2012

China's record copper imports during the latter part of 2011 and early 2012 means that copper inventories are now at a position where it could result in lower imports. China is the biggest consumer and importer of copper.

Copper inventories monitored by Shanghai Futures Exchange are at their highest since 2003 while China's February imports were the second highest ever at 484,569 tonnes. In contrast, supplies in Europe and the US are pretty tight. As such, Layton expects copper exports from China to pick up in March and April while copper imports into China drop substantially.

Meanwhile, Chinese copper production is also showing an uptick which could further add into domestic supplies, thereby strengthening the case for lower imports. As of the data released by the National Bureau of Statistics, China produced 437,500 tonnes of refined copper in Feb 2012, up around 9.50% Year-on-Year.

Benchmark LME copper prices are currently trading at $8,500/tonne, trading up for the year but still about 15% down from the $10,000/tonne peak hit last year.

 G O L D   T E C H N I C A L  V I E W - 19/Mar/2012 – 24/Mar/2012

MCX GOLD last week faced strong resistance at 28120 level. Amid volatility was seen on account of Budget session and closed with negative bias as per weekly charts. It looks good to buy above 28120 above which 28550 is seen as immediate resistance to move towards higher levels. On lower side, if 27400 level is breached then it looks weak which may take it towards 27170 levels.

 

S T R A T E G Y

Sell MCX Gold around 28000/28100 for the targets of 28700 with stop loss of 28200.

S I L V E R    T E C H N I C A L  V I E W- 19/Mar/2012 – 24/Mar/2012

On daily charts, MCX SILVER had made a triangle pattern. A breakout with good volumes from this pattern is expected in this week which may lead it towards 59500. On higher side, 61500 can act as strong resistance. On other hand, 56500 acted as support last week and is expected to act in coming sessions as well. Any fall below this can drift silver towards 55500 and 54000.

S T R A T E G Y

Better strategy in the Mcx Silver at this point of time is to sell on highs. For the target of 55550, with stop loss of 58200.

 C R U D E   T E C H N I C A L  V I E W- 19/Mar/2012 – 24/Mar/2012

Crude Oil showed sideway movements last week where 5420 acted as strong resistance. Last week crude broke its crucial support of 5280 but unable to give closing below this level. Now if crude will break 5420 then it may find next resistance around 5500. On lower side 5220 is acting as supporting zone for it.

S T R A T E G Y

Better strategy in MCX CRUDEOIL is to buy on dips for the targets of 5500/5600.

C O P P E R   T E C H N I C A L  V I E W- 19/Mar/2012 – 24/Mar/2012

MCX COPPER has been moving in a strong channel pattern since months for which a breakout is still withheld. On daily charts copper was violated strong resistance of 435 gave closing below this level and form a reversal pattern doji. Now if it is maintain below 435 and break 431 with good volumes then next support is around 420. On higher side 440 is act as resistance. 

S T R A T E G Y

Better strategy in the MCX COPPER will be sell on highs, with the stop loss of 440 for the targets of 420.