OIL HOLDS GAINS AS PRODUCERS SAY MARKET RE BALANCING | TODAY COMMODITY MARKET NEWS OUTLOOK 25 SEPT 2017.

COMMODITY MARKET TIPS

Precious Metals

Precious metals are likely to open flattish as markets await new triggers this week. The dollar has staged a slight rebound as other currencies weakened. The yen fell on reports that Shinzo Abe may seek an additional stimulus of 2 trillion yen to aid economic growth. The euro was under pressure as Angela Merkel won with a lesser margin than expected in Germany and the far-right party gained vote-share. The pound has been subdued after Moody’s lowered UK’s credit rating by a notch to Aa2.

Base Metals

Base metals have been trading choppy in a range; with the short term bias still remains confusing. LME zinc bounced back as markets stabilized on Monday after investors slashed risk late last week on concerns about China's credit and escalating tensions over North Korea. Copper witnessed some liquidation as Hedge funds and money managers cut their net long position in COMEX copper positions by 21,558 contracts to 99,729 in week to September 19.

Energy

Crude oil prices are likely to open flat but a third consecutive drop in US rig count will support prices. Baker Hughes data show that the number of oil rigs in the US fell by 5 to 744 last week. The OPEC meeting comments showed that the decision about extending the supply cuts will be taken in January. OPEC/nonOPEC technical committee estimates that compliance to output cuts reached 116% in August. Brent prices have been supported as demand for prompt-loading barrels at North Sea crude market has jumped and supply remains lower due to oilfield maintenance. On the other hand, US production has almost fully rebounded after Hurricane impact and is now close to 9.51 mbpd.