Spices on the move

Updated: Aug 30 2006, 05:30am hrs
It was a continuation of the weakness in the US dollar on the second trading day of the week leading to a monthly loss against euro. The fall in the dollar supported the gold prices in the early session after previous days sell off. However, crude oil after a brief short-covering slided below the key support of $70 on news that the tropical storm Ernesto, which was expected to disrupt production facilities in the Gulf of Mexico region has veered away from that region.

Moreover the production facilities in Prudhoe Bay, which contributes 7% to US refined crude capacity, has been restored to half production capacity. This led to a fall in the gold and silver too and couldnt gain support from the gaining euro.

Gold was down to Rs 938 a gram from the days high of Rs 945 a gram; silver was down to Rs 19.15 a gram. The market looks ahead for the North Americas consumer confidence data and minutes of August 8th meeting of FOMC.

Brent crude oil at London - based on ICE futures too was down by 84 cents to $70. Natural Gas at the NYMEX too slipped by 4% to $6.16, at the MCX it was down to Rs 310 an mbtu.

Base metals were back alive on Tuesday after the LME opened after traders left on a long weekend holiday. Copper slipped from the days high of Rs 356.5 to Rs 349 a kg.

Market watch

The bull run in spices continued unabatedly with turmeric joining the party on Tuesday. Pepper that was down on profit taking and sluggish buying, recovered sharply on the news of rise in spot prices following conclusion of Kerala market federations auction where it was reportedly sold at Rs 108 per kg ungarbled. The firm international prices and all-round positive market sentiments are holding pepper futures strongly up. The chilli futures soared by 2.37% to Rs 5,875 in benchmark October contract.

Courtesy: Geojit Commodities