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Jolts Job Openings and Commodity Intraday Tips

Crude Oil prices continued to fall for the larger part of the day, the markets lacked any fresh data from the major global equities as there was no major economy or policy related cues. We do not expect any major cues today either. In other important updates for the commodity, the US EIA in its weekly report might show crude stocks probably increase by 1.85 million barrels for the week ended 07 March. Crude related cues continue to press US oil prices as the markets might also look for any fresh developments in the euro-zone. Though concerns of outright war between Ukraine and Russia have receded, the problems have not resolved completely. Crimea, which is dominated by people of Russian origin, has become a point of contention lately. According to a Bloomberg update, Russian troops detained Ukrainian border guards in Crimea as the region prepares for a March 16 referendum on joining Russia. In case the aforementioned issues escalate, we could see some support for crude oil prices both at the US and Brent, which at the least might protect the commodity from falling further. Currently however, the situation continues to be normal. The backwardation between the Crude April and May contracts at the NYMEX stayed near the 50 cent mark, though we saw the Mar and April contract continuo increase to Rs 13. We have a buying recommendation for the spread locally on a holding basis. We feel it will further enhance to Rs 25 in the coming sessions. Nevertheless, gains might be lost if international crude prices start rising due to any unexpected developments in Ukraine and a surprisingly positive inventory report in the US. Overall though, we continue to hold a bearish stance on the commodity and recommend selling on pullbacks for smaller targets. The rupee’s appreciation is also expected to further aid the selling bias in the local markets Global market analysis: US equities closed marginally lower overnight. However Asian equities are trading higher led by Japanese cues after the Bank of Japan which in its monetary policy, stuck to its stand of maintaining the easy monetary policy ahead of the sales tax hikes which comes into effect in the month of April. From the currency space the dollar index is trading marginally higher at 79.78, while the euro is trading marginally lower against the dollar at $1.3870. Coming to crude oil, prices traded down and settled at $101.12 while this morning it is seen trading steady. We believe oil prices may continue to trade down amid speculation that crude stockpiles rose in the US. Meanwhile, Brent oil prices also traded down after the Chinese data showed exports number declined sharply. We believe the weakness may remain on today’s trade however, losses may be minimal. We recommend selling crude oil from higher levels. From the economic data front, we have a few important numbers in the form of German trade balance, UK industrial production and from the US whole price index. Commodity Intraday Tips SELL CRUDE OIL MCX MAR NEAR 6200 SL 6260 TGT 6140 SELL REF SOYA OIL NCDEX APR BELOW 739.9 SL 743.5 TGT 735.5 Today Economic Data Indicators: DATE

TIME

Region

Indicator

Period

Survey

Prior

12.03.14 12.03.14 12.03.14 12.03.14 12.03.14 12.03.14 12.03.14 12.03.14 12.03.14 12.03.14

12:30 12:30 12:30 12:30 12:30 15:00 15:00 19:30 19:30 19:30

JN GE GE GE GE GE UK US US US

Machine Tool Orders YoY Labor Costs SA QoQ Trade Balance Exports SA MoM Imports SA MoM Current Account Balance Industrial Production MoM NFIB Small Business Optimism JOLTs Job Openings Wholesale Inventories MoM

Feb P 4Q Jan Jan Jan Jan Jan Feb Jan Jan

---15.0B 1.4% 1.3% 16.0B 0.2% ---0.5%

40.3% -03% 14.2B -0.9% -0.6% 23.5B 0.4% 94.1 3990.0 0.3%


Jolts job openings and commodity intraday tips