Crude Oil Trades Flat, LME Base Metals Weaken

European stocks traded on mixed sentiments today as shares of carmakers, travel companies and personal-goods producers declined. US stock futures are trading in the green and Asian markets ended its trading session on a mixed note today.

German Ifo Business Climate index rose to 109.6-mark in February from the previous level of 108.3 in the prior month.

Spot Gold prices in the international markets traded on a flat note at $1775/oz and touched an intra-day low of $1771/oz till 4.30 pm IST today. The yellow metal prices in the domestic markets traded higher by 0.5 percent and was hovering around Rs28,777/10gm till 4.30 pm IST. Depreciation in the Indian Rupee led gains on the domestic bourses.

Weakness in the US dollar helped spot silver prices to trade higher by 0.7 percent to $34.54 an ounce till 4.30 pm IST today. The white metal hit an intra-day high of $34.74/oz till 4.30 pm IST. Silver prices in the domestic markets were up by 0.6 percent and were trading at Rs57,578/kg till 4.30 pm IST today.

Uncertainty over Euro Zone debt worries led choppy sentiments in the global markets today. This led base metals complex to trade lower on the LME in today’s trading session. LME copper declined around 0.4 percent at $8417/tonne and in the Indian markets prices were trading lower by 0.6 percent at Rs415.10/kg till 4.30 pm IST.

Nymex crude oil prices are trading on a flat note at around $106.27/bbl till 4.30 pm IST today and in the Indian markets prices were up by 0.3 percent at around Rs5259/bbl. Expected rise in US crude oil inventories coupled with weak market sentiments acted as a negative factor for prices on the international markets .

The US Energy Department (EIA) is scheduled to release it weekly inventories report today and crude oil inventories are expected to increase by 0.5 million barrels for the week ending on 17th February 2012. Gasoline stocks are expected to decline by 0.1 million barrels whereas distillate inventories are also expected to fall by 1.4 million barrels for the same period.

Outlook

Varying market sentiments on the back of rising risks associated with the European economies is expected to lead to risk aversion in the global markets. Additionally, US economic data to be released at 7.00pm IST today is forecast to show a rise in unemployment claims. If the data comes in as per expectations then sentiments could take a hit further.

On account of this, we expect precious metals and base metals to trade on a negative note today.

Crude oil prices on the other hand are expected to trade on a rangebound note today, taking mixed cues from weak global market sentiments on one hand and supply-side worries from Iran on the other.