Base Metals Trade On Negative Note, Crude Oil Gains

European equities are trading on a negative note today on the back of unfavorable economic data from Germany coupled with a rise in risk aversion in the global markets. Asian markets ended on a bearish note and US stock futures are trading in the green.

German IFO Business Climate declined by 1.6 points to 105.3-mark in June as against previous rise of 106.9-level in May. Spot gold prices increased around 0.2 percent owing to weakness in the US Dollar Index (DX). The yellow metal touched an intra-day high of $1571/oz and hovered around $1568/oz today. In the domestic markets depreciation in the Indian rupee restricted prices from trading higher. It touched an intra-day high of Rs.30,019/10gm and hovered around Rs.29,943/10 gm till 4:30 p.m IST today.

Taking cues from rise in gold prices coupled with weakness in the DX, Spot silver prices traded on a flat note today. However, further upside in silver prices was capped on the back of downside in base metals pack. 

The white metal touched an intra-day high of $27.04/oz and was trading around $26.84/oz till 4:30pm IST today. On the MCX, Silver July contract gained around 0.1 percent on account of depreciation in the Indian rupee and hovered around Rs.52,948/kg  after touching an intra-day high of Rs.53,190/kg today.

The base metals complex traded on a negative note today on the back of rise in risk aversion in the global markets. However, weakness in the DX restricted sharp fall in prices. Copper the leader of the base metals group declined around 0.6 percent on the back of rise in LME copper inventories along with negative global market sentiments. On the domestic front, prices traded on a flat  note on the back of depreciation in the Indian rupee and closed at Rs.414/kg till 4:30pm IST today.

Nymex crude oil prices gained around 0.6 percent today on the back of expectations of storm starting to form in the Gulf of Mexico coupled with weakness in the DX. Crude oil prices touched an intra-day high of $79.01/bbl and hovered around $78.69/bbl till 4:30pm IST today. On the domestic bourses, prices gained by 0.1 percent and was trading around Rs.4,523/bbl after touching an intra-day high of Rs.4,538/bbl today.

In today’s session we expect precious metals, base metals and crude oil prices to trade on a negative note tracking bearishness in the global markets. Although US stock futures are trading in the green, we feel that sentiments could reverse as we approach the weekend and uncertainties in global market still persist. There is no economic data from the US today and sentiments would be largely tuned with worries over economic slowdown.