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Commodity outlook: Crude futures gain, here's how others might trade

Crude oil was up 0.57 per cent while its peer natural gas advanced 0.14 per cent.

ETMarkets.com|
Last Updated: Jun 05, 2020, 01.39 PM IST
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Oil prices eased slightly on Friday as markets wait to see whether major producers will commit to an extension of record production cuts to support oil prices.

Commodity Summary
MCX

NICKEL
CPO
CRUDEOIL
Crude oil was trading higher in Friday’s trade as market participants await cues from a meeting that could take place this weekend where major oil producers will discuss whether to extend record production cuts.

Gold and silver were down over 0.50 per cent, while nickel, copper and zinc fell up between 0.10-0.50 per cent. Crude oil was up 0.57 per cent while its peer natural gas advanced 0.14 per cent.

NCDEX Agridex, an agricultural futures Index which tracks the performance of the ten liquid commodities, was up 0.36 per cent at 1,038 as cottonseed oilcake gained nearly 3 per cent but soybean and chana were down up to 0.15 per cent.

Here is how SMC Global expects commodities to fare today:

Spices: Turmeric futures (June) are expected to take support near Rs 5,250, while the upside may remain capped near Rs 5,350 levels. The agricultural mandis in Nizamabad, Telangana have resumed trade after remaining shut for over two months due to a nationwide lockdown imposed to curb the spread of coronavirus pandemic. Jeera futures (June) may witness consolidation in the range of Rs 13,700-13,900 levels. The gains are getting capped due to a sharp rise in supplies of around 50,000-60,000 bags (1 bag = 55 kg). Cardamom futures (June) may show an upsurge towards Rs 1,640, taking support near Rs 1,550.

Oilseeds: Soybean futures (June) is likely to witness a consolidation in the range of Rs 3,870-3,950 levels and trade with an upside bias. Mustard futures (June) may remain stable in the range of Rs 4,560-4,655 levels. Soy oil futures (June) is likely to consolidate in the range of Rs 795-810 and trade with a downside bias, whereas CPO futures (June) may trade with a negative bias in the range of Rs 646-656 levels.

Gold and silver: Bullion counter may trade with a bearish bias. Gold may test Rs 45,900 and facing resistance near Rs 46,900 while silver may test Rs 48,000 while facing resistance near Rs 49,300.

Base metals: Base metals may trade with sideways to bullish bias. Copper can move towards Rs 427 while taking support near Rs 420. Zinc may move towards Rs 163 and taking support near Rs 159. Lead can move towards Rs 139 while taking support near Rs 134. Nickel may trade with bullish bias where it may test Rs 975 and taking support near Rs 952. Aluminium may move towards Rs 136 while taking support near Rs 132.

Energy: Crude oil may trade with bullish bias if continue to hold above Rs 2,780. It may extend the bullish rally towards Rs 2,940 and Rs 2,550 provide support. Oil prices eased slightly on Friday as markets wait to see whether major producers will commit to an extension of record production cuts to support oil prices. Natural gas may trade in sideways territory where it may take support near Rs 135 and may face resistance near Rs 142.

Other commodities: Cotton futures (June) are expected to trade sideways in the range of Rs 16,000-16,300 levels. The upside may remain capped owing to weakness being witnessed in the international cotton prices, due to concerns hovering over China’s demand from US under the Phase-1 trade deal. Chana futures (June) will probably continue to take support near Rs 4,140, while the upside may get extended towards Rs 4,220 levels, owing to prospects of higher procurement. Rajasthan allowed government agencies to procure chana from up to 120 farmers in a day, double of the earlier cap. Mentha oil futures (June) may face resistance near Rs 1,115 and the upside may remain limited. The harvest operations of this mint is on full swing, but due to lockdown the business is getting affected as the farmers are not able to sell their produce to the oil factories, through traders.
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