MUMBAI: Early morning optimism has helped commodity futures to maintain winning streak so far. And, investors are showing no signs of giving up on gains as underlying factors remain highly supportive. Initial trades saw thin participation as most Asian markets are shut for Chinese Lunar New Year. US dollar falling off from nine-month high vs. euro has supported investors to hold their long position. Euro has been on the decline against US dollar due to the impeding financial crisis in the European region. Euro had suffered due to lack of clear signals from European Central Bank (ECB) on bailout plan.
Positive market cues aided US crude oil futures to rise above $75 a barrel. However, trading participation was thin in the morning as most of Asia markets remained shut for the Lunar New Year. NYMEX crude for March delivery last stood at $75.16 a barrel in electronic trading, up $1.38 from late on Monday. Remember, there was no settlement price on Monday because the New York Mercantile Exchange was closed for the US President's Day holiday.
Analysts have been sounding positive on oil lately and industry leaders have also echoed similar sentiment. Oil is likely to hold in its current price range during 2010, although some upward movement could be possible, oil major BP's Chief Economist said on Monday.
Gold prices advanced above $1,111 per ounce as bullion benefited from investor risk aversion on worries about 's fiscal crisis, but trading was subdued with many Asian players out for the Chinese new-year. Spot gold was trading at $1,111.30 an ounce.
US gold futures for April delivery on the COMEX division of the New York Mercantile Exchange were also quoting higher from London trading on Monday at $1,113.00, up about 2.1% from New York levels on Friday. markets were closed on Monday for Presidents Day. Gold priced in euros rose to a peak of 809.50 euros an ounce, just below its record high of 812.43 euros an ounce set in December.
The world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings stood at 1,106.38 tonnes as of February 15, unchanged from the previous business day.
London Metal Exchange (LME) copper rose 0.2% in holiday-thinned trade on Monday against a backdrop of worries about Chinese monetary tightening and euro zone debt. With much of Asia shut for the Lunar New Year, and a market holiday in the , just 67 lots of copper traded hands. Prices rose $11 to $6,821, the low of the day, having earlier touched $6,860. The contract was last quoting at $6,975. LME aluminum was trading higher at $2,090. Nickel price rose to $19,750 a tonne, benefiting from higher premium in London spot markets.
Copper prices fell 1.9% on Friday after surprised markets by hiking the percentage of cash banks must keep as reserves, which reduces funds available for lending. The increase, coming in the wake of benign inflation data, and ongoing doubts about debt levels in, put paid to an attempt to see copper break above $7,000 last week. Domestic commodity markets maintained firm trend tracking the global markets. However, rupee gaining against the US dollar has applied check on price rise. On MCX, crude oil contract for near-month settlement was last quoting 1.5% higher at Rs 3,483 a barrel, not far from early highs of Rs 3,493. The contract had opened the session at Rs 3,434.
MCX Gold for April also stretched early morning gain. However, the price gain was capped by stronger rupee. After a slow start, the contract surged to Rs 16,760 per 10 gram on increased buying interest. It has since retreated to trade at Rs 16,711 per 10 grams. MCX Silver March settlement contract traded 1% higher at Rs 24,808 per kg, after having opened the session at Rs 24,560.
Base metal counters have also maintained strong posture. MCX copper for February settlement added 1% to trade at Rs 320.80 per kg. MCX zinc February contract strengthened further to trade at Rs 102.95 a kg, up 1.1%. The contract had resumed today’s session at Rs 101.80.
