Commodity markets closed out a very unenergetic week with minor gains in most of the non-agri commodities. With an overall dip in the futures trading volume, mainly due to the August lull, precious metals and base metals stayed in a narrow range as traders remained on the sidelines waiting for some positive news from either the FED or the European Central Bank.
Crude oil once again was the outperformer with a gain of more than four per cent on weekly basis followed by copper which rose by 1.31 per cent on MCX. Although the talks of releasing the US strategic reserves capped the gains in oil prices the unrest in West Asia and hopes that European Central Bank may take some steps to stimulate the economy supported crude oil prices.
Re decline supports
Gold traded in a narrow range of $1600-1620 per ounce on COMEX as traders still await some kind of stimulus by FED to revive the slowing economy. On MCX, Gold prices sustained above the psychological mark of Rs 30,000 and closed the week with a gain of almost 0.5 per cent.
The depreciation in rupee has supported gold prices in the domestic market keeping the physical demand lower as traders are waiting for a dip in prices.
Rupee depreciated by 0.67 per cent against the dollar as compared to last week.
The dip in physical demand has been outweighed by investment demand which has been is on a rise supporting bullion prices.In the base metals pack, copper topped the charts whereas zinc was the worst performer as it fell by 1.77 per cent on pressure from overproduction and weak demand.
The upside in copper was mainly driven by an upbeat US consumer confidence data and with supportive comments from German Chancellor on fighting the Euro Zone crisis. Also the LME inventories have fallen to their lowest levels since early June indicating a pickup in demand.
Agri outperforms again
Although non-agri commodities witnessed a very dull movement in prices, agri commodities once again outperformed with 12 out of 15 most traded commodities registered a gain in prices on NCDEX.
Castor seed topped the charts with a gain of more than 13 per cent due to continued buying support from speculators followed by turmeric which gained by almost eight per cent. There was some profit-taking in the early sessions of the week in turmeric but the overall trend continues to be bullish as a decline in sowing area and overseas sales were supporting prices at lower levels. Farmers slashed area under turmeric sowing this season after a sharp fall in prices since last year.In soya complex, soybean which was on a continuous rise due to a drought situation in the US and a shortage of rainfall in India eased, as good rainfall in the top producing Madhya Pradesh prompted traders to book profits. The western part the State got 54 per cent more rainfall than normal in the week ended August 15 according to Meteorological Department.