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Global Commodities Roundup: Market Talk

8 Jun 2017 7:55 am

0755 GMT [Dow Jones] Gold is capped by the bearish trend line, which emerged on June 6, on the 30-minute chart. A new test to its next support level at $1,282 seems more likely to occur. The declining 50-period moving average is playing a resistance role. The MACD is below its 0-level. The RSI is mixed with bearish bias. The upside potential should be limited by the key resistance at $1,291. As long as this key level is not surpassed, look for a further drop to $1,282 and even to $1,277.5 in extension. Only a break above $1,291 would turn the outlook to positive and call for a new upside to $1,295. Gold is trading at $1,287.5 an ounce. [This piece contains the opinions of Trading Central and does not constitute personalized investment advice or form part of any invitation or inducement to buy or sell any security. The author has been prohibited by Trading Central from purchasing or otherwise directly or indirectly acquiring any direct or indirect beneficial ownership of any instruments or markets for which Trading Central or its affiliates issues recommendations. To read more, visit bit.ly/1MehCU9.] (analysts-europe@tradingcentral.com)

0751 GMT - As India's goods-and-services tax is just weeks from going into effect, the World Gold Council says the country's gold industry will benefit despite short-term challenges. While overall tax rates on gold will increase slightly, firms will be able to offset that against their revenue and avoid double taxation rampant throughout the country, the group says. It adds that the proposed GST rate of 3% on gold is lower than anticipate and that the next tax structure will usher in greater transparency in a highly fragmented gold market, where retailers often mislabel the caratage of their gold products. India is one of the world's top consumers of the metal. (biman.mukherji@wsj.com)

0729 GMT - China seems to have avoided a trade war with the US, but trade frictions with other economies may increase, says Citi. China has sent an agricultural delegation to the US to discuss more imports from America. The investment bank says that could create agricultural-product trade diversions from other resource-rich economies. It adds that rising tension in Qatar and other Arab countries could also affect China's oil-and-gas imports from the Middle East, leading to more such purchases from the US. (liyan.qi@wsj.com)

0720 GMT - Based on China's May oil-trade data, the country's net imports of petroleum has risen some 880,000 barrels/day this year, says Jefferies. That shows the country's oil demand is rising as demand for diesel has likely stopped falling, the investment bank adds. According to Jefferies' calculations, China's implied diesel demand has increased 3 months in a row. "Whatever substitution effects have been causing diesel demand to fall may have run their course." (jenny.hsu@wsj.com)

0636 GMT - Tokyo rubber futures settled lower for a 10th-straight session as late Wednesday's declines couldn't be overcome today. That amid persistent worries of increased supplies. "Investors took to selling amid concerns of an increase in production" in top grower Thailand, says Kaname Gokon of Okato Shoji in Tokyo. A late drop in Japan stocks amid a rising yen also hit rubber. Tokyo Commodity Exchange contract for November delivery fell 2.1% to Y181.6/kilogram. (vibhuti.agarwal@wsj.com)

0551 GMT - The suspension of senior executives at Malaysian palm-oil producer Felda Global (5222.KU), followed by a government appointment to look into the matter, has analysts skeptical about whether the world's third-largest palm-plantation operator is tackling its issues or just staging a show to appease its landowners ahead of an upcoming general election. Felda Global's landowners, commonly known as settlers in Malaysia, are majority voters and command at least 25% of parliament's seats. Some of the settlers have been complaining about the firm's poor performance and delayed payments from its parent, state-owned Felda. Settler unhappiness may hurt the ruling government's chance to hold on to power, analysts have said. The election is due on or before mid-2018. (yantoultra.ngui@wsj.com ;@yantoultra)

0530 GMT - China's commodities imports mostly rebounded in May, underscoring views that China's demand remains broadly robust, says Daniel Hynes, an ANZ commodities strategist. With the exception of coal imports, imports of major commodities increased from the previous month. "Overall the trade data should help ease concerns about demand conditions in China, particularly coming on the back of the better than expected manufacturing PMI for May," he adds, but warns the growth of fixed-asset investment and infrastructure construction will critical to China's import growth for in 2H. (jenny.hsu@wsj.com)

(END) Dow Jones Newswires

June 08, 2017 03:55 ET (07:55 GMT)

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