MARKETS VIEW

NOTE : IF CRUDE OIL CROSS 3935AND SUSTAIN IT WILL TOUCH 3950/65/78
TRADE AS PER GIVEN LEVELS WITH STOP LOSS.

MARKETS VIEW

Crude ends skid, as OPEC leaves production ceiling unchanged Crude futures rose steadily on Friday, halting a midweek slump as OPEC expectedly kept production levels unchanged from their current level at approximately 30 million barrels per day. Although the majority of OPEC's smaller nations have advocated for a slash in production output to boost prices, they have been overruled by Saudi Arabia which is looking to undercut U.S. shale producers by depressing prices. “The reality now is that we cannot have this $100 (a barrel) anymore. This is a fact. We have less value for our barrels,” OPEC secretary general Abdalla Salem el-Badri said at a Friday news conference. Iran, which could release a glut of crude into the global markets over the next several months if longstanding economic sanctions are lifted by Western powers, announced Friday that it is currently producing approximately 3 million bpd. In a span of only five years, Iran is optimistic it can double output to a level of 6 million bpd by 2020. An outflow of Iranian oil into the global markets is considered to be bearish for crude prices, which have been tamped down by a glut of oversupply in recent months. In the U.S., oil services firm Baker Hughes (NYSE:BHI) said that the number of oil rigs nationwide fell last week by four to 642, the lowest level since August, 2010. It marked the 26th consecutive week of weekly rig declines. Dollar-denominated commodities such as crude become more expensive for foreign purchasers when the dollar appreciates. (Source:: Investing.com)

Gold ticks down, as strong U.S. jobs data increases rate hike chances Gold futures ticked down on Friday extending losses from earlier this week, as optimistic U.S. jobs data increased the possibility that the Federal Reserve could raise interest rates sooner than previously expected. Gold prices plunged early on Friday morning after the U.S. Bureau of Labor Statistics released better than expected job figures for the month of May. Last month, U.S. non-farm payrolls soared by 280,000, far exceeding analysts' low end of forecasts for a 220,000 gain. Private payrolls increased by 262,000 in May, as professional business services added 63,000 positions on the month. The labor market also added 17,000 construction positions, following a significant gain of 35,000 a month earlier. While the economy grew at a tepid pace over the last several months, Hawkish members of the Fed argued that temporary drags such as severe winter weather and a West Coast port labor dispute disproportionately restrained growth. The Labor Department also upwardly revised jobs figures for the previous two months further underscoring the Hawkish viewpoints. While the unemployment rate inched up to 5.5% in May, the Labor Force Participation rate also moved higher last month, increasing 0.1% to 62.9%. The Fed's decision to tighten monetary policy is viewed as bearish for gold. The precious metal is not attached to dividends or interest rates and struggles to compete with high-yield bearing assets in periods of rising rates. Separately, Federal Reserve of New York president William Dudley reiterated on Friday that the Fed will likely raise rates at some point this year. It is widely expected that the Fed could wait until September before raising its benchmark Fed Funds Rate, though it has not ruled out lift-off in June. On Thursday, the International Monetary Fund suggested that the Fed should wait until the first half of 2016 for lift-off unless the U.S. economy improves dramatically over the next several months. (Source:: Investing.com)  

MCX VIEW

Crude retreats from Friday's surge, as shale production remains flat Crude futures edged down on Monday, one session after soaring amid dwindling U.S. rig counts as investors locked into profits from a surge at the end of trading last week. Energy traders also digested further indication of slowing U.S. production, as output among the nation's most productive shale formation remained flat last month. On the New York Mercantile Exchange, WTI crude for July delivery fell 0.07 or 0.12% to $60.23 a barrel. On Friday, WTI crude surged more than 4.5% to close above $60 a barrel for the first time in nearly two weeks. On the Intercontinental Exchange (ICE), brent crude for July delivery dipped 0.57 or 0.87% to $64.99. Brent also soared last Friday, gaining 4.76% to near $66 a barrel. Brent wavered between a session-low of $64.26 and a high of $65.75 on a choppy day of trading. Meanwhile, the spread between the international and U.S. benchmarks of crude stood at 4.76, down from Friday's level of 5.23. On Friday, oil services firm Baker Hughes (NYSE:BHI) said the number of oil rigs in the U.S. last week dropped by 13 to 646, the lowest level since August, 2010. A week earlier, the U.S. rig count fell by one to 659 marking the slowest rate decline over the last 24 weeks. Nevertheless, the rig count is still down drastically after peaking above 1,600 last fall. The dwindling rig count provides some signals that the glut of oversupply in the global market may be on the verge of significant reduction. Last Thursday, the Energy Information Administration (EIA) said that U.S. crude stockpiles decreased by 2.8 million barrels for the week that ended May 22, marking the fourth consecutive week of weekly declines. Crude futures are down more than 10% since OPEC rattled markets with its decision to keep production levels constant. Energy traders await a key OPEC meeting in Vienna on Friday for further indications of supply levels in the market. OPEC is widely expected to keep production steady at over 30 million barrels per day. As U.S. crude stockpiles dangerously neared full storage capacity earlier this spring, industry observers kept a close eye on production levels at shale fields throughout the nation. Last week, U.S. crude production increased to 9.566 million. barrels per day up from a total of 9.262 for the week ending May 15. While concerns of oversupply have waned slightly, shale production remained virtually unchanged in April. At the Bakken formation in Western North Dakota, shale production increased by a modest 2,000 barrels per day in April according to figures from Bentek Energy, while production at the Eagle Ford formation in Southern Texas rose by a mere 1,000 bpd. The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, surged to an intraday high of 97.76, nearing its highest level in five weeks.