Mr. Prathamesh Mallya , AVP- Research, Non-Agri Commodities and Currencies, Angel Broking Ltd
The global markets have started observing multiple positives of late. Following the U.S. firms, now British drug maker, AstraZeneca, has joined the flock with its vaccine expected to be 90 percent effective against the coronavirus. It has no serious side effects as well.
Joe Biden has received a heads up on transition into the White House after weeks of the Presidential elections. The development further uplifted the market sentiments.
Gold
On Tuesday, Spot gold prices closed at 1807.5 per ounce, ending lower by 1.5 percent as a rising bets on a potential vaccine continued to weigh on its appeal. The yellow metal also came under pressure as business activities in the U.S. expanded at its fastest pace in five years, thereby signaling an overall recovery in the world’s largest economy from the ongoing crisis.
The safe haven asset, Gold, is expected to remain under pressure due to vaccine hopes and Joe Biden’s transition.
Crude Oil
WTI Crude prices surged by 4.3 percent to close at $44.9 per barrel on Tuesday. The optimism over another potential vaccine against the pandemic and U.S. President-Elect Joe Biden’s transition underpinned the global outlook.
The oil prices were further supported by the anticipated tighter supply of OPEC and its allies in the coming months. They are believed to revoke the planned reduction in the production by January 2021 considering the ailing oil markets and no concrete signs of revival in demand.
The market also received another set of affirmations by robust economic recovery reported in October’20 across the U.S, and European markets.
A Lower Dollar amid expectation of potential vaccine against the coronavirus might continue to support oil prices.
Base Metals
Base metals on the LME ended positive with Nickel being the highest gainer amongst the pack. Growing demand from China, a weaker Dollar, and the vaccine euphoria elevated the industrial metal prices.
Expanding service and manufacturing activity amid improvement in October’s employment figures in the U.S. signalled towards a balanced recovery within the world’s largest economy which further underpinned the market sentiments.
As per reports from the International Lead and Zinc Study Group (ILZSG), the global Zinc market surplus stood at 33,100 tonnes in September’20, up from 31,500 tonnes reported in August’20.
In the first nine months of 2020, the Zinc market surplus came up to 437,000 tonnes compared to a deficit of 197,000 tonnes in the same period last year.
LME Copper ended higher by 1.6 percent to close at $7293 per tonne robust demand from China and the optimism over a potential vaccine against the pandemic underpinned the prices.
Surge in demand from China and optimism over a potential vaccine against the pandemic might support the industrial metal prices.
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