MCX COMMODITY MORNING MARKET NEWS UPDATES - 27 NOV 2017

Pipeline Shutdown, OPEC Production Cut Extension Key Market Drivers - U.S. West Texas Intermediate crude oil futures hit a two-year high last week and international-benchmark Brent crude oil hovered near a multi-year high as investors reacted to the partial closure of the Keystone pipeline connecting Canadian oilfields with the United States. The news was bullish because it contributed to the tightening of U.S. supplies. This should be an active week for crude oil traders. The key market driving events will be the Keystone Pipeline problem and the OPEC meeting on November 30. WTI crude oil futures should continue to remain underpinned and prices could continue to rise the longer it takes to bring the Keystone pipeline back on line. Some traders are estimating the pipeline may be out for another two weeks. On November 30, OPEC meets in Vienna, Austria. It is expected to extend the deal to cut production from March 2018 to December 2018. According to Bloomberg, OPEC and Russia have outlined the framework for an extension. However, at this time the details remain unclear and the news report says there is no final agreement yet. The majority of OPEC members are endorsing an extension, however, Russian support is the key risk.

COPPER - March Comex High Grade Copper futures reached its highest high since November 1 on Friday while posting its fifth consecutive higher close. The catalyst behind the rally was a weaker U.S. Dollar, although investors remained concerned over demand from top consumer China. Low volume also contributed to the rally so it will interesting to see if the upside momentum can be sustained when the major players return on Monday. They are going to have to decide if the stronger dollar is driving the price action at this time, or if worries over demand from China as the government takes steps to reduce risks in the financial system will be the main drive of price action.

GOLD - Gold prices slid lower on Friday as some investors took profits at the end of the week, but losses were held in check by the weaker dollar. A weaker dollar typically tends to support gold, which is denominated in the U.S. currency and becomes more affordable to foreign buyers when the dollar declines. The dollar remained on the back foot after Wednesday’s minutes of the Federal Reserve’s November meeting showed that some officials were concerned inflation would stay below the bank's 2% target for longer than expected. The minutes echoed comments by Fed Chair Janet Yellen earlier in the week that she was uncertain about the inflation outlook. While a rate hike in December is still almost fully priced in, investors pared back expectations for further rate hikes in 2018, sending the dollar lower. A weaker dollar and a pickup in global growth have pushed copper prices up almost 27% this year. In the week ahead, the changing of the guard at the Federal Reserve will be a big focus for investors, with investors awaiting comments from a number of Fed speakers, including both the current chair and next head of the U.S. central bank. U.S data on personal income and spending, which includes the personal consumption expenditures inflation data, the Fed's preferred metric for inflation, will also be closely watched. Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

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