MUMBAI: Commodity counters once again turned lower as concerns about uncertainties in the global economic recovery still loom large leading investors into relinquishing their position. Also, the worries about Europe's fiscal issues, European finance ministers and other officials have been in meetings in Brussels on Monday and Tuesday, reviewing details of planned bank stress tests, has had a negative influence on investor sentiment.
US crude oil prices continue to trend lower despite forecasts indicating inventories in top consumer the United States fell for a fourth consecutive week, while earnings optimism lifted Asian stock markets. West Texas Intermediate crude oil for August slipped 58 cents to $74.37 a barrel. WTI touched $76.48 on Friday, the highest price this month.
Crude oil stockpiles probably fell by 2 million barrels in the week to July 9, as per analyst survey, after tumbling 5 million barrels a week earlier because of shutdowns and shipping disruptions related to Hurricane Alex.
But supplies of gasoline and distillates such as heating oil and diesel may have increased, the survey showed. Distillate inventories likely posted a seventh straight weekly gain, rising by 700,000 barrels, gasoline stocks probably have added 300,000 barrels.
The industry group American Petroleum Institute (API) will release its weekly inventory report later today, followed by government statistics from the Energy Information Administration (EIA) on Wednesday.
Gold inched up as a fall below $1,200 per ounce the previous day invited light physical buying, while holdings by the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, rose for the first time since late June.
Spot gold inched up $2.00 to $1,198.20 an ounce. Technically, the market confirmed resistance near the 50-day moving average. Investor caution ahead of the earnings season and firmness in the US dollar also put a lid on the precious metal's prices.
On Friday, it hit a one-week high around $1,213 an ounce, still well below a lifetime high of $1,264.90 struck in late June.
SPDR Gold Trust said its holdings rose to 1,314.82 tonne as of Monday, up 0.30 tonne from the previous business day. That marked the first rise since holdings retreated from a record 1,320.44 tonne marked in late June.
Friday's US Commodity Futures Trading Commission data showed net long noncommercial US gold futures positions fell 14.6% to 209,042 contracts in the week to July 6, the lowest weekly level since mid-April.
Base metal counters are trading weak this morning despite firm equities lifted optimism in financial markets. Shanghai copper seen trading weak amid stick to a tight range, while London extended the previous session's 2% loss.
Three-month copper on the London Metal Exchange (LME) lost $60 to $6,600 a tonne. Concerns about uncertainties in the global economic recovery still loom large, but a steady decline in LME copper stocks is stoking hope of improving demand.
LME copper stocks fell another 1,650 tonne to 435,250 tonne on Monday, the lowest since late November last year.
Meanwhile, Alcoa - the largest aluminium producer - posted a stronger-than-expected second-quarter profit on Monday and raised its estimate for global aluminium consumption, sending its shares up 3% in after hours trading. LME aluminium price edged down $15 to $1,965 a tonne.
Domestic commodity counters were largely lower tracking international markets. MCX crude oil futures for July lost 0.7% to trade at Rs 3,499 per barrel after spending the session between Rs 3,520 and Rs 3,497.
Precious metals counters continue to trade amid narrow range movement. MCX Gold contract for August settlement was last quoting at Rs 18,373 after having spent the session between Rs 18,375 and Rs 18,355 per 10 grams. MCX Silver September settlement contract was trading marginally down at Rs 28,764 per kg, after having opened the day at Rs 28,800.
Base metal counters were trading weak following the soft trend in global metal prices. MCX copper for August settlement was quoting 0.9% lower at Rs 309.95 per kg. MCX zinc July contract lost 1.7% to trade at Rs 84.95 per kg.
