Oil prices rise on expectation of output cut extension - 8 May 2017

Commodity Intraday Tips
China March Gold imports from Hong Kong hit 10-month high.
Gold imports from Hong Kong to China has increased by 55 percent and totaled at 112 mt when compared to 72 mt in the previous year, as per Hong Kong Customs and Statistics. The figure is more than double 48 mt in February and the highest volume since May 2016. Chinese imports during year to date was seen at 191 mt, which is 21 percent higher when compared to 159 mt in the same period last year. As per the recent Swiss Federal Customs data, the total gold imports from Switzerland to China mainland increased 34 percent and totaled at 136 mt against 101 mt a year ago.Based on the London Bullion Market Association settlement price, gold averaged $1,231/ ounce in March, down from $1,234/ounce in February. China is the largest Gold consuming country followed by India, China and India accounts about half of the global consumption.

Zinc Inventories Fall in China Major Markets, SMM Reports.
Combined zinc inventories in Shanghai, Tianjin and Guangdong decreased 6,400 to 161,700 tonnes last week, SMM data show. Zinc inventories in Shanghai and Tianjin increased slightly. Stocks in Guangdong saw further declines. Total inventories in the three regions are expected to continue falling this week but declines will be less significant with influx of imported zinc in Shanghai.  Continuously falling zinc inventories will support zinc prices. But downstream consumption was hurt by environmental protection reasons. In this scenario, zinc prices will meet resistance to rise, SMM added. Zinc prices are expected to hover at low levels this week, SMM foresees. LME zinc may move in the range of $2,5202,630 per tonne this week, SMM predicts. SHFE June zinc will move between 21,000-21,900 yuan per tonne. SHFE zinc may look for support from the 4-week moving average this week.

Oil prices rise on expectation of output cut extension.
Oil prices rose on Monday on a growing conviction that an OPEC-led production cut initially scheduled to end in June would be extended to cover all of 2017, although a relentless increase in U.S. drilling activity is seen capping gains. Said the victory of Emmanuel Macron in the French presidential elections against far-right Marine Le Pen also supported oil prices as it raised hopes of a more stable European economy.  The market is becoming more confident that the OPEC and other producers including Russia, who pledged to cut output by almost 1.8 million barrels per day (bpd) during the first half of the year in order to prop up the market, will extend the deal to cover all of 2017.

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