Morning Report 26-09-2011


Monday 26 September 2011


Spot gold prices was trading in a slight negative note as investors continue to exit their holdings on speculation that Hedge funds have started selling off and CME has raised margins to hold gold contracts which would be costly for the speculators to hold the positions. Gold declined close to 10% last week in order to cover their losses in equities & commodities and preferred to hold cash. Gold SPDR’s the world’s largest gold backed ETF holdings remained unchanged on  1252.21 tons on Friday. Outlook: Gold is expected to be volatile & trade with negative bias & take cues from Europe.


Silver traded at $29.11  an ounce on Monday in Asian trading down by 6%. Silver fell nearly 20% last week and continued to fall today as speculators are exiting their positions on concerns of increase in margins and covering losses in other risky assets and  preferred to hold it in cash.  Margins were hiked in Shangai gild exchange & speculators in silver reduced their bullish bets, according to CFTC report. Ishares silver trust, the world’s largest silver backed ETF holdings  stood at  9868 tons on Friday.  Outlook: Silver is expected to trade in negative bias & take cues from Europe.


U.S. crude prices  declined last week on concerns that Euro & US may slip into recession and demand may decline for the crude oil.  US WTI on monday traded at $80.02 a barrel taking support from Euro zone officials who gave confidence that they are working on new ways to stabilize the faltering economy. IMF is likely to return to Athens this week in order to finalize the bailout package for Greece. The issues in MENA continue as Yemen president refused to step-down and called for early elections. Outlook:  Crude oil prices is expected to take cues from developments in Euro one & US dollar.


Copper prices fell to $7330 metric ton down by 0.4% at LME extending their losses on fears of Greece default triggered worries about global recession which could affect the demand for the metal. The active copper contract at Shangai futures exchange  declined 2.6% to 55640 Yuan per metric ton hitting 12 months low. The world’s major economies pledged to prevent Europe’s debt crisis from weak Euro banks & financial markets. Outlook : Copper prices is likely to trade in negative bias  and take cues from developments in Euro zone & US dollar.


Yesterday the selloff in the global asset classes has affected the Rubber futures on the National Multi-Commodity Exchange also.

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