WEEKLY BULLION REPORT-19 May To 24 May 2014

MARKET FUNDAMENTAL NEWS & REPORTS 
 
GOLD

Gold closed out the week at 1293.60 easing at the close as trades grow tiresome of the Ukraine crisis and now wait for other data to give it direction. Most believe that gold will return to its downtrend now that the US is recovering nicely. The dollar held steady against major currencies as selling of the currency faded with benchmark U.S. yields stabilizing at their lowest levels in six months, although the  greenback faces further weakness if yields resume their decline. The dollar pared earlier losses against the yen and euro after a stronger-than-expected report on U.S. housing construction but is still on track for its biggest weekly losses since early April. In India, Rupee strengthens to its highest level & is expected to be so. This also exerting pressure on precious metals price for further downward movement. The Gold Import duty is expected to be lowered from new government in India. So, we have to keep patience & put a watch for the policies formulation & its impact on commodity market. 
 
 
SILVER 
Silver ended the week above its opening on Monday closing at 19.358 after touching a weekly high of 19.993. Precious metals are weak with little direction as traders grew bored of the situation in the Ukraine and also words from Janet Yellen. Stronger Rupee also exerting downward pressure on precious metals price. Silver will also get effects from Gold Import duty which is expected to be lowered from new government in India. So, we have to keep patience & put a watch for the policies formulation & its impact on commodity market.


CRUDE OIL 

Crude Oil closed above the 102 level on implied demand increases after Japanese GDP printed stronger than expected as well as positive US data. Oil prices moved modestly higher on Friday as the market found support from US gasoline demand hopes ahead of the looming summer-holiday driving season and the ongoing Ukraine crisis. Brent Oil ended at 109.88 gaining steadily this week while Gasoline remained in the green at 4.439. Oil prices were finding support from the approaching US summer holiday season that kicks off with the long Memorial Day weekend May 24-26. Refineries were beginning to wind down their maintenance season in preparation for a ramp-up in activity in several days. Traders keptan eye on the unfolding Ukraine crisis. The United Nations warned Friday of an “alarming deterioration” of human rights in eastern Ukraine, where the government is battling an insurgency by armed pro-Russian separatists. With the May 25 presidential vote fast approaching, Kiev’s interim leaders are struggling to keep the country from disintegrating further after Russia’s disputed annexation of Crimea in March. Escalation of the conflict could severely disrupt energy supplies and send prices soaring, analysts say, because Ukraine is a vital conduitfor Russian oil and gas exports to Europe. Nearly 15% of all gas consumed in Europe is delivered via Ukraine.

NATURAL GAS 

Natural Gas ended the week on a down note at 4.439 as traders sold off as demand continues to decline during the seasonal change and a drop in residential demand. The commodity hit a high of 4.508 as inventory data was released on Thursday. Natural gas futures capped a second weekly decline on forecasts for mild weather that would limit power-plant demand, easing concern that supply will fall short of summer needs. Gas slipped 1.3% after climbing 2.3% yesterday. Commodity Weather Group LLC predicted mostly normal temperatures on the East Coast from May 21 through May 25.

COPPER 

Copper had a solid week to close at 3.143 as China continued to stock up the metal and rumors of stimulus from the ECB helped support metal demand. Midweek news came that a copper production facility in South Korea would unexpected close for two weeks for maintenance after a fire. The LS-Nikko copper plant in South Korea is expected to halt production for at least two weeks after an explosion caused injuries, sources with knowledge of the matter said on Wednesday, as the shutdown drove up copper prices. Eight workers were injured in the explosion, which occurred during maintenance at the smelter on Tuesday. One of the sources said that at least 250,000 tonnes of annual capacity at the smelter had shut and was unlikely to restart for at least two weeks, cutting the firm’s overall output. Despite a recent recovery in London Metal Exchange copper prices, market analysts were still bearish this week on the metal’s price for the rest of this year, based on factors such as a surge in supply and a weak Chinese construction sector.

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