MUMBAI: Expectations on European Union bailing out from financial crisis have buoyed markets sentiment, sending equities and commodities higher on Wednesday.
Momentum continued to fuel growth in prices of most commodity futures this morning as currency moves lent support.
US dollar trended softer against euro ahead of EU summit. Meanwhile, other data flows from US, and European are currently keeping lid on commodity prices.
Crude oil futures rose for the fourth-straight session this morning as reports of a potential bailout for debt-laden buttressed markets and a monthly report from the Energy Information Administration (EIA) contained bullish signals.
The US Energy Information Administration raised its forecast for crude demand and prices this year, a sign it expected an economic recovery to gain steam.
NYMEX crude for March delivery was up 23 cents at $74.76 a barrel after settling 1% higher at $74.52 on Wednesday.
January crude oil imports rose 33% from a year earlier as economic recovery bolstered demand for fuels.
The country imported 17.11 million tonnes of crude last month, the General Administration of Customs said on its website.
Gold inched up this morning as the euro held steady against the US dollar before a European Union summit about a possible bailout of debt-strapped, while firm oil prices added support. Trading was thin because of a national holiday in.
Spot gold was quoted at $1,079.25 an ounce, up $5.40 from New York’s notional close on Wednesday. Bullion was 12% below a lifetime high of $1,226.10 hit in early December.
US gold futures for April delivery hardly changed at $1,076.4 an ounce, having fallen on Wednesday after Federal Reserve Chairman Ben Bernanke's comments about a possible stimulus pullback and interest rate hike lifted the US dollar.
The world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings were at 1,106.38 tonnes as of February 9, unchanged for the second straight day. The holdings hit a record high of 1,134.03 tonnes on June 1.
Base metals, led by copper, reversed earlier gains on Wednesday as the US dollar broadly rose after Federal Reserve Chairman Ben Bernanke said he could begin reining in stimulus. Soft trading pattern persisted this morning as well in Asia.
Shanghai copper was seen flat as markets continue to track currency and equity market sentiment. Chinese data, including inflation, will also steer investment flows, in particular given the macro-number vacuum caused by heavy snows in the .
Data on Wednesday showed January imports of unwrought copper and semi-finished copper products fell 21% on the month, to 292,096 tonnes.
Three-month copper on the London Metal Exchange (LME) fell $50 to close at $6,540 a tonne on Wednesday, but reversed losses in after-hours dealing to rally to $6,640. LME copper last stood at $6,755 a tonnes, off one-week high.
The domestic commodity markets firm tone since opening piggy-backing stronger global cues.
On MCX, crude oil contract for near-month settlement was last quoting 0.2% higher at Rs 3,474 a barrel, off its early low of Rs 3,471, which is also its opening tick for the day.
MCX Gold for April settlement contract moved in a narrow range as stronger rupee applied check on price gains. After a dash to Rs 16,335 per 10 gram, the contract has retraced to current level of Rs 16,330 per 10 grams.
MCX Silver March settlement contract traded 0.6% higher at Rs 24,480 per kg, after having opened the session at Rs 24,300.
Base metal counters maintained steady upward trend. MCX copper for February settlement traded 1.4% higher at Rs 311.80 per kg.
MCX zinc February contract regained Rs 100 a kg mark for a brief period. The contract was last quoting 0.6% higher at Rs 99.20 a kg, after having resumed the session at Rs 99.
