Commodity markets hoping for Obama win: Angel Broking

In an interview to CNBC-TV18, Naveen Mathur of Angel Broking spoke about the importance of US election for the commodity complex. He said "I think the commodity space would do better if the democrats continue to be in the US and they win the elections this day."

Below is the transcript of his interview with CNBC-TV18 Q: How important an event is the US election for the commodity complex tomorrow? A: The US elections which are scheduled to happen today is very important. We are going to see the results in India by tomorrow morning or so. If Democrats continue to rule the US, I think the policies taken by the Obama administration would continue. The positive sentiments would build around and the markets would be little on the upside. On the other side, if the Romney wins, it will be a little uncertainty leading upto the fiscal cliff issues. The Republicans have the clear-cut majority in the House of Representative. They will be able to manage the fiscal cliff. Overall the sentiments would prevail, if the Obama administration continues to rule the US state and the economy. Q: How would you position yourself in gold leading up to the event, given your expectations of what the dollar may do? A: I think the commodity space would do better if the democrats continue to be in the US   and win the elections this day. Overall, we feel that the markets would be slightly positive on the sentiment side for the commodities. Maybe the dollar would gain strength, which will cap the higher side on the commodities space. But overall looks like that the commodities space would be on the positive side, if the democrats win the election. For gold and the silver, we expect the buying for the intraday in the market at 30,750- 30,770 levels. Stop loss at around 30,640 and the targets on the upside at around 30,980. We expect the markets for the silver, crude and the copper in India to be on the upside. Although, the rupee factor on the depreciative side would also play a very critical role for the markets to be on the positive territory. Therefore, a buying recommendation for all the commodities for intraday. Q: What did you make of the pullback in crude yesterday, from USD 105 per barrel to USD 108 per barrel? A: The brent definitely has moved up. It’s because of the demand which came up after the hurricane Sandy which hit the US last week. Overall, also if you see the shipments towards the north, there was a delay from the North Sea, which pulled up the Brent prices. Therefore, we saw the NYMEX crude prices also moving on the higher side trading at around USD 86-85.50 per barrel. We expect the prices to trade in the range of USD 85 per barrel on the downside to around USD 87 per barrel on the upside. Overall, for the Indian markets we recommend a buying strategy. This strategy would be at around Rs 4,620-4,630 per barrel levels. Stop loss can be placed around Rs 4,570 per barrel and we are expecting targets of around Rs 4,700-4,710 per barrel.