Bet on gold, silver to help your portfolio shine: Emkay

Ashok Mittal of Emkay Commodities spoke to CNBC-TV18 about his views on commodity market.

Below is the verbatim transcript of the interview…

Q: What you are telling your clients to do with crude now?

A: Market in the first half may remain little stable because people will wait for the US data coming in the evening and then take fresh cues.

However, crude may remain under pressure right now because of two things. One, the inventory levels are quite high and also the hurricane event which was more or less discounted. So, what there will not be any risk on the supply side right now and we don’t see much of demand happening right now or the trigger to buy.

So, we are advising that on the higher side maybe, USD 96-96.50 per barrel should be the resistance for NYMEX crude oil. On the downside we expect somewhere USD 92-93 per barrel to be achieved. The idea is to sell on the slight uptakes from the current levels and keep a stop loss of about USD 1, that is about Rs 50-55 and the target can be about Rs 150-200 downside, may be Rs 5,150-5,200 per barrel on the MCX.

Q: Silver had a great run. Do you think the run is over?

A: Although it looks like little overboard, but still there is some more upsides in gold and silver. So, silver we are expecting somewhere about USD 32 per ounce to be touched before it may correct on the downside.

So, we still think that it should be bought around Rs 57,500 per kilogram or so and the target may be Rs 59,500 per kilogram. So, another Rs 2,000 on upside is possible.

Q: You would say the same of gold?

A: Gold has been in the range for quite a long time since it has broken on the upside. So, we should see somewhere about USD 1,700-1,710 per ounce as the target and USD 1660 per ounce should be the buy level and the stop loss may be about USD 1,640 per ounce.

So, on MCX Rs 30,900 per 10 grams is a level where you can look to buy. Keep a stop loss about Rs 100 that is Rs 30,800-30,750 per 10 grams and on the upside Rs 31,100-31,200 per 10 grams because this is the only thing where people are looking to invest right now and which is expected to perform better.

Q: You are bearish on Copper?

A: Yes base metals, we don’t see any strong signal in terms of buying and no demand happening from any side. So, we expect most of the base metals to remain on the beaten side for the time being except aluminium where the Chinese import has grown up very fast drastically and there import has actually increased and export has decreased. So, from a positional perspective I think aluminium may perform better within the base metal pack.