Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities and Currencies, Angel Broking Ltd
U.S. President Donald Trump showed speedy recovery after being diagnosed with coronavirus last week. The news offered some support to Crude Oil and Base Metal prices while denting the yellow metal’s appeal. However, gold prices ended higher amid the declining Dollar. Hopes over further corona relief package supported crude prices. At the same time, the second wave of COVID-19 cases dented industrial metal prices.
Gold ended higher by 0.75% and closed at $1912.9 per ounce amid hopes of further stimulus by the U.S. while Dollar prices kept elevated.
In the U.S., House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin made constant efforts to bridge the gap between both the parties. The optimism among investors regarding additional U.S. stimulus aid underpinned the prices of the yellow metal.
However, reports regarding the discharge of U.S. President Donald Trump dented gold prices. China’s industrial activities gained momentum in September’20 that further limited the gains in gold. This reflected improvements in the overseas demand and boosted investors’ risk appetite.
The alarming increase in the COVID-19 cases worldwide and a declining U.S. Dollar might support the prices of gold. Its prices are expected to trade higher in today’s session.
WTI Crude prices surged by 5.8% and closed at $39.2 per barrel because of the optimism among investors following President Donald Trump’s recovery. Expectations regarding additional corona relief package by the U.S. supported the Crude Oil prices.
Six Norwegian offshore oil and gas fields closed due to a strike triggered by failed wage talks between the union and the Norwegian Oil Association.
A resurgence of COVID-19 cases and reinforcement of the second round of lockdown in significant world economies further undermined Crude outlook.
OPEC is reluctant to increase Oil production from January 2021 as a measure to counter weak Oil demands. A depreciating Dollar might extend support to Crude Oil prices. Oil prices are expected to trade sideways on MCX in today’s session.
Most of the base metals on the LME ended in the red amid worries over the second wave of the COVID-19 virus in the world’s major economies. The prices were further kept in check by a weaker demand on account of the weeklong Chinese holiday.
However, reports regarding the speedy recovery of the U.S. President Donald Trump from coronavirus extended some support to the industrial metal prices.
Robust growth in China’s industrial activities in September’20 reflected development in overseas demand and industry-driven growth. According to the National Bureau of Statistics reports, China’s official manufacturing Purchasing Manager’s Index stood at 51.5 in September’20.
LME Copper ended lower by 0.37% and closed at $6528.5 per tonne as a drastic increase in the COVID-19 cases worldwide dampened the demand for the red metal. However, hopes of additional stimulus aid by the U.S. and a declining Dollar might support industrial metals. Copper prices are expected to trade sideways on MCX in today’s session.