INTERNATIONAL COMMODITY NEWS :
- Copper futures rose during morning trade in the domestic market on Tuesday amidst firm physical demand for the industrial metal in the domestic spot market. However the gains in the metal were restricted by worries over global growth as manufacturing in the US tumbled to the lowest level since September 2009 with the Markit Manufacturing PMI falling to 50.5 in May from 50.8 in April a tad above the neutral 50-mark.
- Gold prices fell by 0.11 per cent on Tuesday as comments from Federal Reserve officials added to expectations that a rate hike could come as soon as June. The latest signal came from Philadelphia Federal Reserve Bank President Patrick Harker who said that two to three rate hikes are possible this year if the economy continues to grow as projected.
- Crude oil prices rose by 0.15 per cent on Tuesday after Germany’s gross domestic product rose in the last quarter signaling bullish sentiment in the region which raised the demand outlook for the fuel. In a report Statistisches Bundesamt Deutschland said that German GDP rose by a seasonally adjusted 0.7 per cent the same as the preceding quarter. Analysts had also expected German GDP to rise 0.7 per cent in the last quarter.
ECONOMY NEWS :
- Singapore ordered BSI’s operations in the city-state to close, as Switzerland started criminal proceedings against the private bank, in the biggest international crackdown on financial entities dealing with a troubled Malaysian state fund. The Monetary Authority of Singapore (MAS) said on Tuesday it had withdrawn BSI Bank’s status as a merchant bank in Singapore for serious breaches of anti-money laundering rules, the first time in 32 years it has taken such action against a bank.
- Bank of England Governor Mark Carney defended the central bank’s decision to flag the risks of leaving the European Union on Tuesday, hitting back at one of his toughest critics who has called for him to resign.Carney said the outcome of the June 23 referendum could require the Bank to make a big reassessment to how it sets interest rates, something it needed to explain to businesses and households.
- Leaders from the Group of Seven advanced economies will examine potential risks to the global economy when they gather this week for their summit in western Japan, government sources told Reuters.While the global economy was not at a critical stage, uncertainty was rising and the G7 leaders were expected to promote a combination of monetary, fiscal and structural policies to spur growth in their communique, the sources, who were not authorized to speak to the media, said.
TRADING STRATEGY :
- BUY GOLD ABOVE 1247 TARGET 1252 1258 SL 1242
- SELL GOLD BELOW 1240 TARGET 1235 1229 SL 1245