BULLIONS

Bullions counter may trade on firm path as yellow metal was set for its biggest weekly gain in nearly two months, as hopes for a pause in the Federal Reserve’s tightening campaign bolstered bullion’s appeal amid progress on the U.S. debt-ceiling deal. Gold can move in range of 60100-60550 while silver also can move in range of 72000-73500. Philadelphia Fed President Patrick Harker said on Thursday U.S. central bankers should not raise interest rates at their next meeting, even though high inflation is coming down at a “disappointingly slow” pace. Markets now see a 73.7% chance of rates remaining unchanged in June. Gold, which does not yield any interest of its own, loses appeal when interest rates rise. Meanwhile, the U.S. Senate passed bipartisan legislation backed by President Joe Biden that lifts the government’s $31.4 trillion debt ceiling, averting what would have been a historic, first-ever default.

BASE METALS

In base metal counter, Copper can witness lower level buying as it can move in range of 710-725. On the macro front, ADP employment in the US in May was 278,000, compared to the expected 170,000, and the previous reading of 296,000. In addition, the ISM manufacturing index in the United States recorded 46.9 in May, which was lower than that in April and less than expected. It has shrunk for seven consecutive months. The market expected the Fed to pause interest rate hike in June. Zinc may remain on volatile path as it can move in range of 205-211. Aluminum can trade on upside path as it can move in range of 207-212.

ENERGY: Crude oil may trade on positive path as it can move in range of 5700-5950. Oil prices rose on Friday amid bullish sentiment following the passage of a U.S. debt ceiling bill in Washington, while markets weighed the likelihood of price-supportive OPEC+ production cuts over the weekend. Markets were reassured by Congress’ passage of a bill suspending the U.S. government’s $31.4 billion debt ceiling, as well as by earlier signals of a potential pause in rate hikes by the Federal Reserve. Market sentiment was also buoyed by Thursday’s U.S. crude stock data from the Energy Information Administration, which indicated that crude imports had jumped last week. Investor attention is now fixed on the June 4 meeting of the Organization of the Petroleum Exporting Countries and allies including Russia, collectively called OPEC+. Ministers from key oil producing countries will decide whether to further trim output to support government revenues. Further reductions in OPEC+ output following their surprise cut of 1.16 million barrels per day in April would be bullish for crude prices. Natural gas prices may tad further lower as it can move in range of 177-184.

Disclosure

Globe Capital Market Limited (“GCML”) is a Stock Broker registered with BSE, NSE, USE and MSEI in all the major segments viz. Capital, F & O and CDS segments. GCML is also a Depository Participant and registered with both the Depositories viz. CDSL and NSDL. Further, GCML is a SEBI registered Portfolio Manager. GCML includes subsidiaries, group and associate companies, promoters, directors, employees and affiliates.

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