BULLIONS
Bullions counter may trade on volatile path as investor focus turns to U.S. inflation data due later this week, which could shed more light on the timing of the Federal Reserve’s first interest rate cut this year. Overall gold (Jun) can move in range of 66200-66800 while silver (May) also can move in range of 74000-75500. Gold prices hit a record high last week after Fed policymakers indicated they still expected to reduce interest by three-quarters of a percentage point by 2024 end despite recent high inflation readings. Investors now look forward to U.S. core personal consumption expenditure price index data due on Friday. PCE price index is seen rising 0.3% in February, which would keep the annual pace at 2.8%. Traders are pricing in a 70% probability that the Fed will begin cutting rates in June, according to the CME Group’s FedWatch Tool. Lower interest rates reduces the opportunity cost of holding bullion.
BASE METALS
In base metal counter, Copper can move on volatile path as it can move range of 752-765. Meanwhile the price breakout in the copper market can be attributed to China’s copper smelters agreeing to reduce output in response to a significantly tighter raw materials scenario. This tightening has led to a collapse in spot treatment charges, which are the fees earned by smelters for converting mined concentrates into metal. The imbalance between supply and demand has resulted in too many buyers chasing too little material. Zinc may trade on weaker path as it may move in range of 217-222. As the world’s largest buyer of concentrates, China is particularly vulnerable to the squeeze on smelter margins caused by these market dynamics. This collective reaction from China has shifted the market’s attention away from weak global demand to the stressed supply dynamics of copper.
ENERGY
Crude oil may remain on upside path as it may move in range of 6720-6900. Oil prices got support on expectations of tighter supply driven by Russian production cuts and attacks on Russian refineries. Russia told its oil companies to reduce output to meet an Organization of Petroleum Exporting Countries (OPEC) target of 9 million barrels per day (bpd). In late February, Russia had been producing about 9.5 million barrels per day. At the same time, Ukranian attacks on Russian oil refineries have continued. Russia’s Kuibyshev refinery had to shut half of its capacity after a fire broke out. In a sign of further supply tightening, Macquarie forecast that U.S. refinery crude runs would increase by 300,000 bpd next week against a decrease in domestic supply of 500,000 bpd. Natural gas prices may move on upside path as it may move in range of 142-156.

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.

Globe Commodities Limited, Globe Derivatives and Securities Limited & Globe Fincap Limited are subsidiaries of GCML. Rolex Finvest Private Limited, A to Z Consultants Private Limited, A to Z Venture Capital Limited, M. Agarwal Stock Brokers Private Limited, A M Share Brokers Private Limited, Shri Adinath Advertising Company Pvt. Ltd., Orient Landbase Private Limited, Bolt Synthetic Private Limited, Price ponder Private Limited and Lakshya Impex Private Limited are associates of GCML. Globe Comex International DMCC is step down subsidiary of GCML.

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