Base metals may trade with bullish bias where Copper(Mar) can move towards Rs706 per kg and taking support near Rs699. Base metals on both SHFE and LME declined across the board on March 1, 2021, as official data released over the weekend showed China’s manufacturing activity growth slowing in February. China’s official manufacturing Purchasing Managers’ Index (PMI) for February came in at 50.6, according to data released by the country’s National Bureau of Statistics over the weekend. That was lower than January’s reading of 51.3. The roughly 24 million tonne a year refined copper market is already in deficit and was undersupplied by 89,000 tonnes in the first 11 months of 2020, the International Copper Study Group (ICSG) said. Zinc may move towards Rs221/kg and taking support near Rs218. Lead can move towards Rs170/kg, while taking support near Rs168. As per International Zinc Association, Zinc consumption in India to grow by 14-15 per cent in 2021. Nickel trade with sideways to bullish bias where it may take support near 1360 and resistance near 1375. Largest Nickel producing country Indonesia has received an investment proposal from U.S. electric vehicle (EV) maker Tesla. Norilsk Nickel said it had partially suspended operations at its Oktyabrsky and Taimyrsky mines in Siberia because it had detected an inflow of water underground. Aluminum may move to 175 while taking support near 172. There have been continuous outflows from LME warehouses of over 5,000 tonnes per day of the light metal since mid-February.
Bullion counter may trade with bearish bias where Gold may find support near Rs45,800 per 10 grams and facing resistance near Rs46,200, while Silver (May) may trade with higher volatility where it may find support near Rs68300 per kg and facing resistance near Rs69,200. Gold edged higher on March 1, recovering from an eight-month low touched in the previous session, as a weaker dollar lifted bullion's appeal. Spot gold rose 0.3% to $1,739.31 per ounce. US gold futures gained 0.4 per cent to $1,736.10. The US dollar slipped from a one-week high hit in the previous session, making gold cheaper for holders of other currencies. Bullion, however, posted its worst monthly fall since November 2016 due to rising US Treasury Yields, which increase the opportunity cost of holding non-yielding gold. US House of Representatives passed a $1.9 trillion coronavirus relief package on February 27. Speculators decreased their bullish positions in COMEX gold and silver contracts in the week to February 23, the US Commodity Futures Trading Commission (CFTC) said on Friday. Physical gold demand in India gained momentum last week as retail buyers and jewellers lapped up bullion at near eight-month low prices, while Singapore continued to see steady interest for both gold and silver. Silver gained 0.3 per cent to $26.71 an ounce.
Crude oil may trade with sideways to bullish bias where support is seen near Rs4,570 per barrel and resistance is seen near Rs4,640. Oil prices rose more than $1 on March 1, 2021, on optimism in the global economy thanks to progress in a huge US stimulus package and on hopes for improving oil demand as vaccines are rolled out. Oil prices are recovering this morning in line with most risk assets on the back of the US Stimulus Bill passing the House and as central banks continue to sabre rattle to ward off market-implied financial tightening. On the flip side, investors are betting that this week’s meeting of the Organization of the Petroleum Exporting Countries (OPEC) and allies, a group known as OPEC+, will result in more supply returning to the market. Natural gas may trade with higher volatility where resistance is seen near 208 and support near 201.
- SMC Global Securities