Commodity outlook: How gold, oil, base metals and agri commodities may fare today

NEW DELHI: Precious metals were trading higher on Wednesday while base metals were mixed in the domestic commodity exchanges as US dealt punitive measures against China, escalating worries over the trade war between the two countries.

Trade tensions are high as the US government widened its trade blacklist to include some of China’s top artificial intelligence startups. US President Donald Trump said he hoped Beijing would find a humane and peaceful resolution to political protests in Hong Kong while a row escalated over comments by a leading US National Basketball Association official in support of protests in Hong Kong. These developments come ahead of the trade talks between these two countries starting Thursday.

The metals pack may continue to remain pressurised by bleak risk appetite as is evident from weakness in global equity indices tracking increased trade tensions between US and China, Kotak Securities said in a report.

Below are the expectations from SMC Global for the day:

Bullion: Bullion counter may trade sideways, but profit booking at higher levels can be seen later in the day. Gold (Dec) can take support near Rs 38,200 while facing resistance near Rs 38,600 and silver can take support near Rs 45,500 and resistance near Rs 46,200.

Base metals: Base metals may trade sideways. Copper may slip lower towards Rs 432 while taking resistance near Rs 442. Lead may trade with a sideways-to-upside bias, testing Rs 158 while taking support near Rs 153. Nickel may also trade with a weak bias as it can test Rs 1,200 while facing resistance near Rs 1,300. Aluminum may test Rs 136 while taking support near Rs 132.

Energy: Crude oil may witness some short covering at lower levels. Crude oil may test Rs 3,600 while taking resistance near Rs 3,900. Natural gas can trade on a weak path, moving towards Rs 161 while taking resistance near Rs 165.

Spices: Turmeric futures (Oct) are expected to face resistance near Rs 6,200. Jeera futures (Oct) may consolidate in the range of Rs 16,700-16,900, with upside capped. Dhaniya futures (Oct) may continue to face resistance near Rs 5,925 and trade with a downside bias. Cardamom futures (Nov) may witness an upside momentum towards Rs 3,200.

Oilseeds: Soybean futures (Oct) may trade sideways to negative in the range of Rs 3,790-3,865. Mustard futures (Oct) may trade higher towards Rs 4,060-4,070. Soy oil futures (Oct) may trade with a downside bias in the range of Rs 759-763 following the tepid buying in wholesale markets. CPO futures (Oct) are likely to take support near Rs 542.

Other commodities: Cotton futures (Oct) are expected to take support near Rs 19,400. Chana futures (Oct) are expected to trade rangebound within Rs 4,240-4,325. Mentha oil futures (Oct) are likely to break Rs 1,198 and plunge towards Rs 1,180 amid a rise in supply from major producing regions in anticipation of lucrative returns.