Stock markets in India are presently trading marginally higher. Sectoral indices are trading on a mixed note with stocks in the banking sector and realty sector witnessing maximum buying interest.
The BSE Sensex is trading up 29 points (up 0.1%) and the NSE Nifty is trading up 5 points (up 0.1%). The BSE Mid Cap index is trading down by 0.1%, while the BSE Small Cap index is trading up by 0.4%. The rupee is trading at 64.40 to the US$.
In the news from commodity markets, crude oil is witnessing buying interest today. Most of the gains came in after data released showed a fall in US crude stockpiles.
According to data from the Energy Information Administration (EIA), US crude inventories fell by 4.7 million barrels in the week to July 14. This was against analyst expectations for a decrease of 3.2 million barrels.
Apart from the above, crude oil is also in focus ahead of a key OPEC meeting next week.
While the above gains come as a welcome breather, crude oil has been witnessing losses lately on concerns regarding the rising output from OPEC.
Owing to the supply glut, crude oil prices have been remarkably silent over the last two years. Prices have remained within a tight range, rarely dropping below US$40 or rising above US$60. Volatility has crashed. And if you are trading crude oil, it’s critical to understand why this has occurred.
One of the issues of Vivek Kaul’s Inner Circle (requires subscription) explains what has triggered the above taming in crude oil prices.
To keep a tab on the movements in crude oil and other commodities, you can read the stock market commentary from the Daily Profit Hunter team. Their commentary tracks the developments in the global economy as well as stock, currency and commodity markets.
On the domestic front, rising oil prices do not bode well for the Indian economy. This we say is because India is hugely dependent on petroleum imports. In fact, the share of petroleum imports for India has only increased over the years, as can be seen from the chart below:
