Wednesday, December 16, 2015 MAJOR COMMODITIES. News & Development. For Private Circulation Only

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1 Wednesday, December 16, 2015 For Private Circulation Only MAJOR COMMODITIES Commodity Expiry High Low Close Change Commodity Expiry High Low Close ($) Change Gold 5-Feb Gold (Oz) Feb Silver 4-Mar Silver (Oz) Mar Crude Oil 18-Dec Crude Oil Jan Natural Gas 28-Dec Natural Gas Jan Copper 29-Feb Copper 3M Nickel 31-Dec Nickel 3M Aluminium 31-Dec Aluminium 3M Lead 31-Dec Lead 3M Zinc 31-Dec Zinc 3M News & Development Labor Department data showed that the U.S. core Consumer Price Index rose 2.0 percent in the 12 months through November, marking the largest gain since May China's top integrated copper producer Jiangxi Copper and Chilean miner Antofagasta Minerals have agreed 2016 treatment and refining charges 9 percent lower than this year's fees, as global mines cut output due to low prices. (Source: Reuters)

2 Gold Gold steadied on Tuesday, arresting the previous day's one percent slide as the two-day U.S. Federal Reserve meeting began and was expected to lead to an interest rate hike for the first time in nearly a decade. The central bank's Federal Open Market Committee (FOMC) is expected to announce the increase at the end of its policy meeting on Thursday at 12:30 am IST, but has hinted that it intends to raise rates only gradually from there. Gold could bounce higher after the move as attention switches from the timing of the first rise to the pace of tightening, analysts said. Gold has fallen 10 percent this year, largely on the back of expectations of a U.S. rate increase. Rising rates increase the opportunity cost of holding bullion rather than interest-bearing assets. The dollar recovered from an earlier six-week low against a basket of currencies after data showed underlying inflation pressures rose in the United States last month. Global equity markets rallied as oil prices bounced from multi-year lows. On Monday, gold prices in India swung to a discount as jewelers and dealers in the world's second-biggest consumer postponed purchases ahead of the Fed meeting. Gold Strategy S2 S1 Close R1 R2 Feb R We expect gold prices to trade negative ahead of US Fed s Dec meeting. Silver Silver was up 0.5 percent at $13.77 an ounce, after a six-day losing streak took it to an August 2009 low. Silver Strategy S2 S1 Close R1 R2 Mar Sideways We expect silver prices to trade sideways ahead of US Fed s Dec meeting. Page 2

3 Crude Oil Oil prices rose for a second straight day on Tuesday as short-covering and technical support halted a slide to 11-year lows, but the market remained fundamentally weak from oversupply, traders and analysts said. Government data on U.S. crude inventories and an expected Federal Reserve interest rate increase would dictate Wednesday's direction, they said. Brent crude futures settled up more than 1 percent while U.S. crude's West Texas Intermediate (WTI) futures rose nearly 3 percent as oil bears once again failed to push prices to below a seven-year trough. The market remained positive in post-settlement trade after a surprise build of 2.3 million barrels in U.S. crude stockpiles reported by industry group American Petroleum Institute for last week. A Reuters poll of analysts had forecast a 1.4 million-barrel draw instead for last week. Official inventory data is due on Wednesday from the U.S. Energy Information Administration (EIA) Aside from the EIA data, the Fed announcement on Wednesday could also cause swings in oil prices, traders said. If the central bank decides to raise rates, it will be the first time it does so in nearly a decade. That could push the dollar up, making dollar-denominated oil less affordable to holders of euros. Some analysts think oil will head lower regardless of the Fed decision. Crude Oil Strategy S2 S1 Close R1 R2 Dec S We expect crude oil prices to trade positive on the back of short covering after slump in prices. Natural Gas U.S. natural gas futures fell nearly 3.8 percent to a 14-year low on Tuesday on forecasts for continued unseasonably mild weather that is expected to curb heating demand through late December. Over the past five days, the contract has fallen about 13 percent, the biggest five-day loss since October. The contract has now been in oversold territory for seven sessions in a row and the Relative Strength Index (RSI) is at its lowest level since August Gas futures for the winter and all of 2016 have been depressed for most of this year, with production at record levels, storage at record highs and forecasts for a warmer-than-normal winter caused by the El Niño weather pattern. Traders said the price rout showed the market was unfazed by the slowdown in U.S. gas production over the past several weeks and an increase in exports to Mexico to record levels. Nat Gas Strategy S2 S1 Close R1 R2 Dec R \ We expect Natural gas prices to trade negative on the back of weak demand. Page 3

4 Base Metals Copper hit a week low on Tuesday as the dollar rallied and investors feared the first U.S. interest rate rise in nearly a decade could trigger a default among highly leveraged miners. The dollar firmed after data showed U.S. inflation pressures rose in November, cementing expectations for a rate hike by the Federal Reserve on Wednesday. A strong dollar makes dollar-priced metals costly for non-u.s. investors. China's factory output growth reached a five-month high in November, signalling a flurry of stimulus measures by Beijing may have put a floor under the economy. China consumes nearly half of the world's copper. Copper appears to have found a near-term floor around $4,500, just above November's 6-1/2 year lows, with traders expected to close short positions into the year end. China's top smelter Jiangxi Copper and Chilean miner Antofagasta Minerals have agreed 2016 treatment and refining charges 9 percent lower than this year's fees, a signal that concentrate supply is tightening. Other metals also fell, hurt by oversupply even though producers have cut back output. The global nickel market moved to a deficit of 400 tonnes in October from a surplus of 8,500 tonnes the previous month, revised figures from the International Nickel Study Group showed on Tuesday. Dec/Feb# Strategy S2 S1 Close R1 R2 Copper# S Nickel S Alum Sideways Lead R Zinc R We expect base metal prices to trade mixed as short term shortage and long term surplus is likely to keep prices mixed. LME Inventories Copper Lead Zinc Aluminium Nickel Current Stock Change % Change % -0.25% -0.93% 0.38% 0.67% Page 4

5 DATE TIME (IST) COUNTRY ECONOMIC DATA CONSENSUS PREVIOUS IMPACT Wed, Dec 16 1:30pm EUR French Flash Manufacturing PMI High 1:30pm EUR French Flash Services PMI Medium 2:00pm EUR German Flash Manufacturing PMI High 2:00pm EUR German Flash Services PMI Medium 2:30pm EUR Flash Manufacturing PMI Medium 2:30pm EUR Flash Services PMI Medium 3:00pm UK Average Earnings Index 3m/y 2.50% 3.00% High 3:00pm UK Claimant Count Change 0.9K 3.3K High 3:00pm UK Unemployment Rate 5.30% 5.30% Medium 3:30pm EUR Final CPI y/y 0.10% 0.10% Medium 7:00pm US Building Permits 1.16M 1.16M High 7:00pm US Housing Starts 1.14M 1.06M Medium 7:45pm US Capacity Utilization Rate 77.30% 77.50% Medium 7:45pm US Industrial Production m/m 0.00% -0.20% Medium 9:00pm US Crude Oil Inventories -3.6M Medium 12:30am US FOMC Statement High 12:30am US Federal Funds Rate <0.50% <0.25% High For Further Assistance Contact: Ashish Shah Tejas Nikhar Mohit Agarwal AVP ashish.shah@sushilfinance.com Sr. Research Analyst tejas.nikhar@sushilfinance.com Research Analyst mohit.agarwal@sushilfinance.com WE / OUR CLIENTS / OUR RELATIVES MAY HAVE PERSONAL TRADING / INVESTMENT INTEREST IN THE STOCKS MENTIONED HERE IN. STATEMENT OF DISCLAIMER This report includes information from sources believed to be reliable but no independent verification has been made and we do not guarantee its accuracy or completeness. Opinions expressed are subject to change without notice. This report cannot be construed as a request to engage in any transaction involving the purchase or sale of a futures contract. The risk of loss in trading futures contracts can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results. Additional information with respect to any commodities referred to herein will be available on request. Sushil Global Commodities Pvt. Ltd. and its connected companies, and their respective Directors, Officers and employees, may, from time to time, have a long or short position in the commodities mentioned and may sell or buy such commodities. Sushil Global may act upon or make use of information contained herein prior to the publication thereof. This data sheet is for private circulation only. While utmost care has been taken in preparing the above, we claim no responsibility for its accuracy. We shall not be liable for any direct or indirect losses arising from the use thereof and the investors are requested to use the information contained herein at their own risk. Sushil Global Commodities Private Limited Member: NCDEX, FMC Regn.No MCX, FMC Regn.No Page 5

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