Spot Gold Prices Flat, LME Base Metals Trade Lower: April 4, 2012

European markets are trading on a flat note today as investor awaited for the US factory orders data to be released later in the evening. Asian stocks also ended its trading session on a mixed note and US futures are trading in a negative territory.

UK’s Construction Purchasing Managers' Index (PMI) increased to 56.7-level in March highest in last 4.5 years from the previous mark of 54.3 in February.

Spot gold prices traded on a flat note today on the back of mixed sentiments in the markets and touched an intra-day low of $1674.34/oz till 4:30pm IST. On the MCX, Gold June contract traded on a flat note and was hovering around Rs. 28,561/10 gms till 4:30pm IST today.

Spot silver prices witnessed a fall of 0.3 percent on account of downside in base metals pack and choppy market sentiments. The white metal touched an intra-day low of $32.79/oz and was trading at $32.87/oz till 4:30pm IST today. On the MCX, Silver May contract dropped by 0.4 percent due to a stronger rupee and was hovering around Rs. 57,389/kg today till 4:30pm IST.

The base metals complex traded lower on the LME today with nickel being an exception. Copper declined by 0.4 percent on the LME on the back of rise in LME copper inventories. Copper inventories rose sharply by 1.2 percent to 260,650 tonnes on the LME warehouses today.

The red metal prices touched an intra-day low of $8,585/tonne and was hovering around $8,590/tonne today till 4:30pm IST. On the MCX, prices traded on a flat note and hovered at Rs. 439.90/kg till 4:30pm IST today.

Nymex crude oil prices declined by 0.8 percent taking cues from expected rise in US crude oil inventories coupled with mixed sentiments in the global markets. Oil prices touched an intra-day low of $ 104.36/bbl and was hovering around $104.41/bbl till 4:30pm IST today. On the MCX, prices declined by 0.3 percent and were trading at Rs. 5,317/bbl till 4:30pm IST.

The American Petroleum Institute (API) is scheduled to release its weekly inventories today and US crude oil inventories are expected to increase by 2.1 million barrels for the week ending on 30th March 2012. Gasoline stocks are expected to decline by 1.2 million barrels and distillate inventories are also expected to drop by 0.3 million barrels for the same week.

Outlook

In the evening session, we expect precious metals and base metals to trade lower on the back of choppy sentiments in the global markets, coupled with strength in the US dollar index.

Crude oil prices are expected to trade with a negative bias in the evening session, on account of an expected rise in US crude oil inventories to be released by API.

However, US factory orders data is expected to be on a positive side today and if the data comes as expected then this will provide support to the commodity prices.