Gold dipped as U.S. Treasury yields rose on an uptick in housing starts for November and even though the dollar fell - Gold on MCX settled down -0.23% at 28405 as U.S. Treasury yields rose on an uptick in housing starts for November and even though the dollar fell. U.S. single-family homebuilding and permits surged to more than 10-year highs in November, in a hopeful sign for a housing market that has been hobbled by supply constraints. Minneapolis Federal Reserve Bank President Neel Kashkari, who this year has dissented three times in votes at the U.S. central bank's policy meetings which raised rates despite low inflation, repeated his view that the labor market still shows signs of slack and could be improved. In the week ahead, the final reading of third-quarter U.S. growth will be the main focus for global financial markets, as investors begin to wind down trading activity before the Christmas and New Year holidays. Meanwhile, U.S. tax reform legislation will remain on the agenda, as lawmakers work to push through a bill to overhaul the tax code ahead of a self-imposed Dec. 22 deadline
Crude
oil gained as the Forties pipeline outage in the North Sea and voluntary
production restraint led by OPEC supported prices – Crude oil on MCX
settled up 0.9% at 3698 amid mixed signals on global production next year,
ahead of US inventory data, expected to show a drop to a two-year low, in a
positive sign for strong US demand, while gains were curbed by fears about a
rise in US output to fresh record highs. Meanwhile OPEC says it will continue
to curb production in an effort to re-balance oil markets, but U.S. shale
output may surge. Also the IEA warned OPEC last week that its supply quota plan
may have limited success. Overnight, crude oil prices traded in the range as
investors mulled over the prospect of fresh Middle East supply disruptions amid
rising geopolitical tensions in the region after reports Saudi air defences
intercepted a missile fired at Riyadh. Rising Middle East geopolitical tensions
raised the prospect of supply disruptions after reports suggested that a
missile was fired at Riyadh from Yemen. Support also seen after the reports of
the missile launch come as investors digested an update from operator of the
Forties pipeline Ineos who said Tuesday that the timeframe for the fix remained
two to four weeks starting from Dec. 11, the date of the shutdown.
Copper
settled flat on profit booking after prices gained fuelled by a rosier demand
outlook after data for last month showed resilience in global manufacturing
- Copper on MCX settled up 0.04% at 448.45 traded in the range as trading
volumes were more thin and expected to be thin throughout the week, ahead of
the Christmas holiday. Copper prices also traded in the range as caution
surrounding U.S. tax reform plans and ahead of U.S. housing sector data
dampened demand for the U.S. dollar. Meanwhile upside for copper was capped
after the update from World Bureau of Metal Statistics which said that the
copper market recorded a surplus of 5.7 kilo tonne in January to October 2017
which follows a deficit of 102 kilo tonne in the whole of 2016. No allowance is
made in the consumption calculation for unreported stock changes, particularly
in the Chinese government stockpile. In the week ahead, the final reading of
third-quarter U.S. growth will be the main focus for global financial markets,
as investors begin to wind down trading activity before the Christmas and New
Year holidays.
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