A Mid Day Look At Gold And Crude
Gold
Spot gold almost paused overnight and is currently hovering near the 1650 level. Spain sold 3.18 billion Euros ($4.2 billion) of debt yesterday, compared with the maximum target of 3 billion Euros. The IMF increased its estimate for global growth in 2012 to 3.5 percent from 3.3 percent and lifted its forecast for the U.S. expansion to 2.1 percent from 1.8 percent, easing concern that Europe’s debt crisis will stifle the recovery.
Foreign direct investment in China, the biggest consumer of metals, dropped for a fifth straight month in March, the longest run of declines since the global financial crisis, on a slowing economy Silver advanced a second day, rising 0.2 percent to $31.7475 an ounce. Spot platinum gained as much as 0.6 percent to $1,594.50 an ounce and palladium advanced 0.2 percent to $663.75 an ounce.
However investors remain cautious on bullion ahead of long term debt sales of Spain later this week and policy meeting by US Federal Reserve next week. At the same time physical gold from India is seen silent despite the key gold- buying festival; Akshya Trichina falls on April 24.
Gold may advance for the first time in four days after Spain sold more debt than targeted and the International Monetary Fund raised its global economic growth forecast, boosting the demand outlook for commodities. Spot gold climbed as much as 0.2 percent to $1,652.30 an ounce and traded at $1,650.68.
Crude Oil
Nymex crude oil prices increased by 1.2 percent on Tuesday taking cues from more than expected decline in US gasoline and distillate inventories from American Petroleum Institute (API) report, reversal of seaway pipeline news along with International Monetary Fund enhancing its growth outlook. Additionally, a weaker dollar index coupled with positive economic data from the Euro Zone front also helped upside in oil prices.
API Inventories Data
As per the American Petroleum Institute (API) report released yesterday, US crude oil inventories increased more than expected by 3.4 million barrels for the week ending on 13th April 2012. However, gasoline inventories declined by 2.6 million barrels and whereas distillate inventories also dropped by 2.4 million barrels for the same week.
EIA Inventories Forecast
The US Energy Information Administration (EIA) is scheduled to release it weekly inventories report today at 8:00pm IST and US crude oil inventories are expected to increase by 1.4 million barrels for the week ending on 13th April 2012. Gasoline stocks are expected to decline by 0.9 million barrels whereas distillate inventories are also expected to fall by 0.2 million barrels for the same period. In today’s session, we expect crude oil prices to trade higher on back of upbeat growth outlook from IMF, reversal of seaway pipeline news and a weaker dollar index. However, sharp gains may be capped due to expected rise in US crude oil inventories.
