MUMBAI: Commodity counters have been sliding lower since morning as bailout plan failed to enthuse markets. Even the Euro kept losing against the US dollar, paring most of its previous day gains as the markets await for key data from the Euro region.
Third quarter GDP data from the region will be revealed later today while the Bank of England deciding on interest rate is compelling investors steer clear of regional currency. Apparently, most commodity counters came off their early highs and are trending lower so far.
Crude oil traded near $80 a barrel after rising to seven-week high on Wednesday as US government report showed that refinery operating rates climbed to the highest level since October, bolstering demand.
The Energy Department (EIA) report showed refinery utilization increased 0.7 percentage point to 81.9% in the week ended February 26. Inventories of crude oil climbed 4.03 million barrels, more than three times what was estimated.
Total fuel demand, averaged over the past four weeks, was 19.3 million barrels, up 3% from a year earlier, the Energy Department said.
Crude oil for April delivery last traded at $80.24 a barrel, down 63 cents, in electronic trading on the New York Mercantile Exchange.
Yesterday, the contract increased $1.19 to $80.87, the highest settlement since January 11. Oil also advanced as the dollar weakened, increasing the investment appeal of commodities.
Gold fell this morning as investors booked profits after the metal rallied to its highest in more than 6 weeks the previous day, but a firm euro could lend support. Spot gold was at $1,132.90 an ounce, down $6.40 from New York’s national close.
Bullion hit an intraday high around $1,144 on Wednesday as easing worries about a Greek debt crisis lifted the metal's safe-haven appeal. US gold futures for April delivery fell $8.10 an ounce to $1,135.20 an ounce, having hit 6-˝ week highs on Wednesday.
The world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings stood at 1,115.51 tonnes as of March 3, up from 1,111.56 tonnes in the previous business day.
Base metal counters have gathered strength yesterday and are looking to extend gains this morning as well as austerity measures boosted sentiments. Shanghai copper likely to trend firm after London prices rose to a seven-week high in the previous session as the US dollar fell against the euro.
Three-month copper on the London Metal Exchange (LME) ended $90 higher at $7,580 a tonne on Wednesday, after peaking at $7,634, its highest since January 11. It eased to $7,490 in Asian electronic trade.
The resumption of operations at key mines in quake-hit Chile capped gains. Copper prices surged to five-week highs on Monday after the earthquake in the world's largest producer of the red metal, led to a temporarily closing of up to a fifth of its mine capacity.
Domestic commodity markets trended lower taking cues from the global markets. However, weaker Rupee prevented steep decline in commodity price.
On MCX, crude oil contract for near-month settlement was last quoting marginally higher at Rs 3,682 a barrel, which is also its intra-day low. The contract had opened the session at Rs 3,688.
MCX Gold for April started lower at Rs 17,006 per 10 gram weighed down by the profit taking. After declining to Rs 16,966 per 10 grams, the contract was last quoting at Rs 16,981 per 10 grams.
MCX Silver March settlement contract traded 1.2% lower at Rs 26,600 per kg, after having opened the session at Rs 26,695. The contract expires at the end of today’s session.
Base metal complex too weakened following the global trend.
MCX copper for March settlement was quoting 0.8% lower at Rs 342.80 per kg, after having started the day at Rs 345.10. MCX zinc March contract lost over 1% to trade at Rs 103.15.
