Gold continues to drop in cycles as market sentiment falters and recovers amidst geopolitical turmoil - 5 Apr 2018

Commodity Intraday Tips
Gold sinks deeper into the 1,330.00 key level as markets stabilize - Gold continues to drop in cycles as market sentiment falters and recovers amidst geopolitical turmoil. The possible trade war lead-up is likely to cool off following this week's round of tariff threats. Gold is continuing to slump in Asia trading, bumping into the 1,330.00 handle and maintaining the bearish momentum that rolled over from Wednesday's action. Gold initially lifted on the week's outset, but repeated rounds of tariffs between the US and China has knocked market sentiment back. Recovering risk appetite has returned to the broad markets, and Gold is stumbling lower after reaching a weekly high at 1,348.22.

Copper dropped after China slapped tariffs on U.S. goods and began a dispute procedure against duties imposed by Washington on Chinese products - Copper on MCX settled down -1.54% at 433.65 in the line of expectation on fresh selling as investors reacted to the potential fallout of an escalating trade conflict between the U.S. and China. The sharp decline in copper prices came after China announced it would hit the U.S. with reciprocal 25% tariffs on more than 100 U.S. products. The tariffs come as China's means of answering President Donald Trump's recent proposal to enact $50 billion worth of tariffs against the country. The threat of a trade war had impacted a number of metals early Wednesday, but copper was among the most dramatically affected. China is the world's top consumer of copper, but also among the top copper producing countries. In 2016, China was the third-largest and the U.S. was the fourth-largest producer of copper in the world.

Zinc prices dropped as pressure seen after China retaliated in kind to a U.S. move to slap tariffs on $50 billion worth of its imports, raising trade war jitters - Zinc on MCX settled down -0.8% at 212.10 settled down on long liquidation as investors battened down the hatches ahead of a possible trade war with China. Today trading volume will remain subdued as the Shanghai Futures Exchange was closed for China's national Tomb Sweeping Day holiday. Some support seen in late session as the United States signaled its willingness to try to resolve an escalating trade dispute with China after Beijing retaliated against proposed U.S. tariffs on $50 billion in Chinese goods by targeting key American imports. While the U.S. and China should avoid a trade war, China's Ambassador to the United States, Cui Tiankai, said on Wednesday, stressing that Beijing's preference was to resolve the dispute through negotiations.

Oil gains on surprise drawdown in U.S. crude inventories - Oil prices rose on Thursday, holding onto a late-session rally the previous day, buoyed by the U.S. government data showing a surprise drawdown in crude stockpiles.Before the rebound late on Wednesday, after the release of the Energy Information Administration (EIA) inventory data, WTI and Brent had hit two-week lows after China proposed a broad range of tariffs on U.S. exports, feeding fears of a trade war.U.S. crude inventories fell by 4.6 million barrels last week, compared with analysts' expectations for an increase of 246,000 barrels, EIA data showed on Wednesday.

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