MCBPL Research Global Macro Economic Changes US Strikes Against Iran – What This Means and How Will Iran Respond? The U.S. Senate Finance Committee will meet on Tuesday to consider legislation to implement the new North American USMCA trade pact, the panel said in a statement on Friday. It said it would meet at 9:30 a.m. (1430 GMT). The U.S. House of Representatives signed off on the deal with Canada and Mexico on Dec. 19. Approval by the Senate committee would clear the legislation for consideration by the full Senate. Senate Republican leader Mitch McConnell has said the chamber would likely take it up after an impeachment trial of President Donald Trump. The European Union’s new trade chief plans to visit Washington on Jan. 14-16 a bid to repair transatlantic relations frayed by U.S. measures against imports from the bloc and its attacks on the global commercial order. Phil Hogan will meet U.S. Trade Representative Robert Lighthizer to discuss disputes including an American threat to hit $2.4 billion of French goods with tariffs in retaliation over a digital-services tax in France. Such levies would mark the first time President Donald Trump’s administration deploys against Europe a policy tool -- Section 301 of a 1974 American law -- reserved so far for the U.S. trade war against China. The prospect has alarmed the EU, which is already scrambling to expand its policy arsenal in response to a separate U.S. threat to the rules-based international system. “The only acceptable route to address trade disputes is through the World Trade Organization adjudication process,” Hogan told the European Parliament in Strasbourg, France on Dec. 19. “The European Union will act -- and react -- as one against any unilateral measures outside the multilateral trading system.” Ties between the EU and U.S., the world’s biggest economic partners, have deteriorated on numerous fronts since Trump took office in January 2017 with an “America First” agenda that has shaken the global order put in place with American support after the Second World War. Hogan’s visit would overlap with another important date on the U.S. administration’s calendar. Trump has said he plans to sign phase one of a trade deal with China on Jan. 15 in the U.S. capital. Index Units CMP Weekly Chg M-o-M Y-o-Y Rupee Spot USD 71.78 (0.59) (0.13) (2.23) Euro Spot USD 1.11 (0.41) 0.44 (2.31) Yen Spot USD 108.08 1.26 0.51 (0.37) GB Pound USD 1.31 (0.03) 0.61 3.53 CBOE VIX - 15.80 8.78 (10.10) #N/A N/A India VIX - 12.70 20.62 (12.82) (24.39) Baltic Dry - 976.00 (20.07) (39.23) (22.97) Date Data Pre. Exp. Cur. 30.12 Chicago PMI 46.3 48.2 48.9 31.12 CB Consumer Confidence 126.8 128.0 126.5 02.01 Unemployment Claims 224K 222K 222K 03.01 ISM Manufacturing PMI 48.1 49.0 47.2 03.01 Natural Gas Storage -161B -60B -58B 03.01 Crude Oil Inventories -5.5M -3.1M -11.5M Chinese Economic Update Date Data Pre. Exp. Cur. 31.12 Manufacturing PMI 50.2 50.1 50.2 31.12 Non-Manufacturing PMI 54.4 54.2 53.5 02.01 Caixin Manufacturing PMI 51.8 51.7 51.5 US Economic Update Economic Review Commodity Weekly Research Report
Transcript
MCBPL Research
Global Macro Economic Changes
US Strikes Against Iran – What This Means and How Will Iran Respond?
The U.S. Senate Finance Committee will meet on Tuesday to consider legislation to implement the new North American USMCA trade pact, the panel
said in a statement on Friday.
It said it would meet at 9:30 a.m. (1430 GMT). The U.S. House of
Representatives signed off on the deal with Canada and Mexico on Dec. 19.
Approval by the Senate committee would clear the legislation for
consideration by the full Senate. Senate Republican leader Mitch McConnell has said the chamber would likely take it up after an impeachment trial of President Donald Trump.
The European Union’s new trade chief plans to visit Washington on Jan. 14-16
a bid to repair transatlantic relations frayed by U.S. measures against imports from the bloc and its attacks on the global commercial order.
Phil Hogan will meet U.S. Trade Representative Robert Lighthizer to discuss
disputes including an American threat to hit $2.4 billion of French goods with tariffs in retaliation over a digital-services tax in France.
Such levies would mark the first time President Donald Trump’s administration deploys against Europe a policy tool -- Section 301 of a 1974 American law -- reserved so far for the U.S. trade war against China. The prospect has alarmed the EU, which is already scrambling to expand its policy arsenal in response to a separate U.S. threat to the rules-based international system.
“The only acceptable route to address trade disputes is through the World
Trade Organization adjudication process,” Hogan told the European Parliament
in Strasbourg, France on Dec. 19. “The European Union will act -- and react -- as one against any unilateral measures outside the multilateral trading
system.”
Ties between the EU and U.S., the world’s biggest economic partners, have deteriorated on numerous fronts since Trump took office in January 2017 with an “America First” agenda that has shaken the global order put in place with
American support after the Second World War.
Hogan’s visit would overlap with another important date on the U.S. administration’s calendar. Trump has said he plans to sign phase one of a trade deal with China on Jan. 15 in the U.S. capital.
Index Units CMP Weekly
Chg M-o-M Y-o-Y
Rupee Spot USD 71.78 (0.59) (0.13) (2.23)
Euro Spot USD 1.11 (0.41) 0.44 (2.31)
Yen Spot USD 108.08 1.26 0.51 (0.37)
GB Pound USD 1.31 (0.03) 0.61 3.53
CBOE VIX - 15.80 8.78 (10.10) #N/A N/A
India VIX - 12.70 20.62 (12.82) (24.39)
Baltic Dry - 976.00 (20.07) (39.23) (22.97)
Date Data Pre. Exp. Cur.
30.12 Chicago PMI 46.3 48.2 48.9
31.12 CB Consumer
Confidence
126.8 128.0 126.5
02.01 Unemployment
Claims
224K 222K 222K
03.01 ISM Manufacturing PMI
48.1 49.0 47.2
03.01 Natural Gas Storage -161B
-60B -58B
03.01 Crude Oil Inventories -5.5M -3.1M -11.5M
Chinese Economic Update
Date Data Pre. Exp. Cur.
31.12 Manufacturing PMI 50.2 50.1 50.2
31.12 Non-Manufacturing
PMI
54.4 54.2 53.5
02.01 Caixin
Manufacturing PMI
51.8 51.7 51.5
US Economic Update
Economic Review
Commodity Weekly Research Report
Bullion Counter
Highlights This Week:
Fundamental Glance:
Gold prices jumped about 2% in total over the past two sessions, resulting
in similar gains on the week for bullion and futures on COMEX.
Gold typically rallies on political and economic troubles. Iran and the
United States have have seen heightened tensions since Trump canceled in 2018 a global nuclear deal Tehran had signed with Washington and other global powers and reinstituted sanctions against the Islamic Republic.
"We took action last night to stop a war. We do not take action to start a
war," Trump said in a televised address on Friday.
Pantheon Macroeconomics Chief Economist Ian Shepherdson said sensitive
assets such as oil and gold could rally further from the U.S. escalation of
the conflict.
"Our base case here is that a full-blown war between the U.S. and Iran is
unlikely, though we appreciate the old adage that nothing brings a country together more effectively than an external threat," Shepherdson said.
In as much as gold remains a favored hedge against geopolitical
uncertainty, it seems set to remain well supported in the near term. Iran
has threatened retaliation, which many analysts see setting off a cycle of
escalating violence, whether against U.S. targets in Iraq, or against U.S.
allies such as Saudi Arabia further afield.
Gold prices jumped their most in a day since the end of August,
hitting four-month highs that could propel the market toward the $1,600 per ounce level after a deadly U.S. airstrike against an Iranian general.
Gold futures for February delivery on New York’s COMEX settled up
$24.30, or 1.6%, at $1,552.40 per ounce after the drone strike near Baghdad airport that killed Qassem Soleimani, the commander who led Iran’s Revolutionary Guards’ Quds force. Tehran has vowed to avenge Soleimani’s death, which President Donald Trump ordered.
It hit a session high of $1,556.05, a peak since Sept 6. The 1.6%
jump on COMEX gold was also the most in a day since Aug. 23. The yellow metal is also less than a 1% gain away from its highest price since April 2013, putting it at a potential six-year high even before it reaches the $1,600 level.
Bullion is expected to trade Positive amid of U.S.-Iran geopolitical tension.
Silver:
Green candle followed by Morning star candlestick pattern on daily chart indicates positive in a counter. Silver has formed
Box pattern and given breakout with above average volume indicates bull strength in a counter. Short term DEMA acts as
a support on down side. Selected Momentum indicator RSI seen with overbought territory. So we recommend to buy on
dip with SL of 46500.
Gold: MSFL- Technical Levels
Big Green Pillar with above average volume after couple of days sustainable on daily chart indicates bull in counter. Gold
has formed Rounding pattern and break out with above average volume. Short term DEMA acts as a support on down
side. Selected Momentum indicator RSI seen with over bought territory. So we recommend to buy on dip with SL of 39800.
.
.
Contract Gold Near
Support-3 38057
Support-2 38481
Support-1 39296
Pivot Level 39720
Resistance-1 40535
Resistance-2 40959
Resistance-3 41774
Contract Silver Near
Support-3 44684
Support-2 45412
Support-1 46469
Pivot Level 47197
Resistance-1 48254
Resistance-2 48982
Resistance-3 50039
Energy Counter
Highlights this Week:
Fundamental Glance:
Brent, the global oil benchmark, rose $1.94, or 2.9%, to $68.19. It hit $69.48 earlier. The last time Brent came close to matching $70 per barrel was in the aftermath of the mid-September attack on Saudi Arabia’s oil facilities, an aggression that the United States had accused Iran of
masterminding.
Friday’s rally came on the back of the U.S. airstrike near the Baghdad airport that killed Qassem Soleimani, the commander who led Iran’s Revolutionary Guards’ Quds force. Tehran has vowed to avenge his death, sparking fears of what an all-out Iran-U.S. conflict could do to the
movement of crude in the world’s most prolific production hub for oil.
Oil prices closed 2019 with their largest gains in three years. Brent rose 24% on the year while West Texas Intermediate gained 34%, largely on production cuts by OPEC kingpin Saudi Arabia and its top ally Russia.
But OPEC+’s promises to cut even more supplies this year has been
tempered by expectations that U.S. crude production could rise strongly in 2020 responding to last year’s price gains.
Non-OPEC oil supply, led by U.S. shale, is forecast to grow by 2.1 million
barrels a day in 2020, according to the Paris-based International Energy Agency (IEA).
U.S. Crude Oil Stocks
Natural Gas storage
Oil prices jumped as much as 5% on Friday, reaching nearly $70 per
barrel on the killing of Iran’s top general, before coming off their peaks despite weekly U.S. inventory data showing a huge drop in domestic crude stockpiles.
While the 11.5-million-barrel drop in U.S.crude inventories reported
for the week ended Dec. 27 was nearly four times more than forecast, it was offset almost perfectly by the total rise in gasoline stockpiles and distillates inventories. The inclination of crude prices was to retreat, rather than continue rising, on those numbers.
Brent, the global oil benchmark, settled up $2.35, or 3.5%, at $68.60. It hit $69.48 earlier. The last time Brent came close to matching $70 per barrel was in the aftermath of the mid-September attack on Saudi Arabia’s oil facilities, an aggression that the United States had
Methods candlestick pattern with spicy volume in daily chart indicate positive in a counter. Crude oil has formed triangle
pattern and given breakout with volume. Short term DEMA acts as a support in down side. Selected momentum indicator
RSI seen with overbought territory. So we recommend to buy on dip with SL of 4420.
Contract Crude Near
Support-3 4070
Support-2 4198
Support-1 4348
Pivot Level 4476
Resistance-1 4626
Resistance-2 4754
Resistance-3 4904
MCBPL-Recommendation
Crude prices expected to trade Positive amid of US-Iran tension .
Metal Counter
Highlights This Week:
Fundamental Glance:
Cif Shanghai copper premiums drop to 2017-low; cif, in-warehouse premium gap widest on record
Shanghai copper premiums have dropped to their lowest level in almost
three years on slack spot demand for imported cathodes ahead of Lunar New Year.
Fastmarkets’ copper grade A cathode premium cif Shanghai stood at $35-
48 per tonne on Friday January 3, down slightly from $38-50 per tonne a day ago.
The benchmark premium, which is often viewed as an indicator of appetite
for imported refined copper, is at its lowest point since March 2017. The premium has been steadily falling since reaching a 2019 high of $70-83 per tonne on October 10.
The copper grade A cathode SX-EW premium, cif Shanghai fell to $35-40 per tonne on the same day, with tonnages sold at low.
Nickel futures on Friday declined by Rs 20.30 to Rs 1,024.20 per kg due to reducing of positions by speculators amid sluggish demand in spot market.
Lead prices on Friday drifted lower by 3.8 per cent to Rs 147 per kg in futures trade as speculators cut bets on low demand.
Spot Commodities Value Change
LME Metal Inventory Change
Copper futures on Friday traded 0.28 per cent lower at Rs 442.55 per
kg as speculators reduced their exposure on weak spot demand.
On the Multi Commodity Exchange, copper contracts for January
delivery fell by Rs 1.25, or 0.28 per cent, to Rs 442.55 per kg in a
business turnover of 2,911 lots.
Similarly, copper contracts for February delivery traded lower by Rs
1.30, or 0.29 per cent, at Rs 446.30 per kg in a business turnover of 43 lots.
Traders said weak demand in spot market mainly pushed down copper
