Commodities Wrap on August 27: Crude oil, natural gas, bullion gain; agri pack lags

"MCX Gold futures have bounced during the trading session Thursday amid a mixed set of economic data. Price hit the lower band of the consolidation range at Rs 46,950, key support for the day. Resistance is seen near Rs 47,600 (200 DEMA). It is expected to consolidate in the broad range of 46,950-47,750 ahead of today’s FED chair comments at Jackson Hole Symposium," Ravindra Rao of Kotak Securities said.

"If it moves below the lower band of the range then it might fall towards the 46,750-46,600 zone," he added.

On Silver, he said, "MCX silver futures moved lower on Thursday as it failed to hold above the 8 day EMA support at Rs 62,980. As mentioned before the 20 days EMA at 64,200 is the crucial hurdle for Silver, a break above would attract buyers. On the lower front 62,100 and 61,500, hold key supports for the day. Meanwhile, the bullish crossover of the MACD line above its 9-day average has supported the bullish view."

Rao believes only a sustained move above Rs 64,200 would bring fresh buying interest and push the silver price towards Rs 65,500.

Globally too, the yellow and silver metal prices were rising higher, with spot gold last trading at $1,803 per ounce and $23.73 per ounce, respectively.

"Spot Gold prices might remain steady ahead of Powell's speech at the Fed's annual economic symposium. However, widening impact of the pandemic might continue to levy some support to the safe-haven asset Gold," Prathamesh Mallya of Angel Broking said.

Oil prices rose on Friday, on track to post big gains for the week, on worries about supply disruptions. Energy companies have begun shutting production in the Gulf of Mexico ahead of a potential hurricane forecast to hit on the weekend.

Brent crude futures rose 1.4 percent, to $72.05 a barrel, after falling 1.6 percent on Thursday. US West Texas Intermediate (WTI) crude futures climbed 1.4 percent, to $68.35 a barrel, clawing back a 1.4 percent loss on Thursday.

"Oil prices might find some support as worries over a potential hurricane heading the Gulf of Mexico ignited near term supply concerns. However, looming worries over the widespread of the Delta variant of the Covid19 virus might weigh on Oil prices," Mallya said.

On MCX, the crude oil was trading over 1 percent higher at Rs 5,100.

The dollar index -- which gauges the greenback against six currencies -- was last down 0.02 percent at 93.05. The rupee, on the contrary, surged to the day's high against the US dollar and slipped below 74. It is at a two-month high for the first time since June 18.

Aluminium was trading nearly a percent higher on Friday at Rs 211 amid worries of a tighter supply of Aluminium raw material. The worries originated after a fire at the Jamalco refinery in Jamaica. This plant can produce up to 1.4 million tonnes per year of alumina, which is refined from bauxite.

"Worries over shortage of primary raw material amid disrupted supply of Aluminium from major producing nation China might continue to support Aluminium prices in the near term," Mallya said.

Copper prices were trading a smidge higher on MCX, rising 0.18 percent to trade at Rs 715.40. On Thursday, LME Copper ended lower by 0.6 percent to close at $9299.5 per tonne as a stronger Dollar amid easing supply worries pressured the prices.

"The Chilean miner Codelco, the world's largest copper producer, reached agreement on a new contract with supervisors at its Andina mine. Andina produced 184,000 tonnes of copper in 2020, around 10 percent of Codelco's total output, Investors might remain cautious ahead of the US FED Chair Jerome Powell speech scheduled today or cues on the asset tapering timeline," Mallya said.

Rubber futures were trading half a percent higher at Rs 181 on Friday, amid concerns of slowing demand in China. Domestic and international rubber prices are trading in sharp divergence with each other. While rubber in domestic markets is touching right-year highs, in international markets, prices dropped to eleven months low.

On one hand, the prices of rubber in global markets have dropped to eleven months low, the prices in the domestic market are hovering around eight-year highs.

Guar Seed futures for delivery in November plunged nearly 6 percent, while that of delivery in September slipped half a percent. Guarex prices were down 4 percent and Jeera prices slipped half a percent.

Dhaniya futures rose slightly and Mustard seed prices slipped half a percent.