Gold, Silver Decline On Lack Of Buying Support

New Delhi: Despite firm global trend, gold prices declined on the bullion market today following lack of buying interest and lost Rs 180 at Rs 13,110 per ten gram.

Trading activity fell due to off-marriage season besides some investors shifting their funds towards rising stock market.

The firming global trend, which normally set prices in domestic markets here, failed to impact the trading activity. The US Federal Reserve cut interest rate by 75 basic points last night to create liquidity and control housing subprime crisis.

Gold climbed by $8.66 to $990.90 an ounce in London. The metal reached a record $1,032.70 on March 17. Silver, rising 16 cents to $19.885 an ounce, failed to impact on the gold prices in domestic market here.

Marketmen said persistent selling by stockists during the off-marriage season mainly pulled down gold prices.

Standard gold and ornaments remained under selling pressure and lost further by Rs 180 each at Rs 13,110 and Rs 12,960 per ten grams respectively. Sovereign followed suit and lost Rs 100 at Rs 10,200 per piece of eight gram.
A similar weakening trend was extended in silver, as the metal for ready delivery dipped by Rs 300 to Rs 24,200 per kg and weekly-based delivery by Rs 90 at Rs 25,880 per kg. Silver coins traded lower by Rs 100 at Rs 27,000 for buying and Rs 27,100 for selling of 100 coins.

Gold Glitters At Rs 12,215, Silver Reaches 27-Year High

New Delhi: After breaching the crucial 12,000 mark yesterday, gold prices surged further to set a new record of Rs 12,215 per 10 gram in the bullion market here today. Run-up to Budget 2008-09

A similar trend was also noticed in silver prices as it touched 27-year high.

Marketmen said there was no physical buying in gold prices at existing higher levels but surging trend in global markets as crude oil reaching dizzy heights raised the concerns of inflation and boosted the demand for gold.

The yellow metal reached to record at $949.20 last night on the New York Mercantile Exchange and silver gained to $17.94 an ounce, the highest since 1980, they added.

Standard gold and ornaments notched up further gain of Rs 175 each to Rs 12,215 and Rs 12,065 per 10 grams respectively. Sovereign followed suit and shot up to Rs 9,700 per piece of eight gram, a level never seen before.

In the silver section, silver ready rose further by Rs 160 at Rs 22,000 per kg on firming global trend and weekly-based delivery jumped up by Rs 400 at Rs 22,840 per kg.

Silver coins rose by Rs 100 at Rs 26,200 for buying and Rs 26,300 for selling of 100 coins.

Silver Surge On Global Cues, Gold Remains Flat

New Delhi: Silver prices strengthened by Rs 270 per kilo in the bullion market here today on buying demand from industrial units and coin manufacturers.

Gold however remained flat today with stockists and jewellers staying away from the market owing to current high prices.

Marketmen said buying activity picked up in silver after reports of the metal rising 0.2 per cent to $17.52 an ounce in the Asian markets.

In the bullion market here, silver ready rose by Rs 200 at Rs 21,600 per kilo and weekly-based delivery by Rs 270 at Rs 22,300 per kilo. Silver coins rose by Rs 100 to set a new record high levels at Rs 26,000 for buying and Rs 26,100 for selling of 100 pieces.

Gold, marketmen said, remained unaltered today as prices ruled firm at current high levels, discouraging jewellers and retail customers from purchasing.

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Uncertainty prevailed in global gold market as well after Group of Seven officials, who met in Tokyo, supported sales of gold from IMF reserves as part of its budget reforms.

The IMF is the third-largest holder of gold reserves behind the US and Germany. The IMF has 3,217 metric tons of gold in its reserves, according to the World Gold Council.

In Delhi bullion, standard gold and ornaments remained unchanged at Rs 11,950 and Rs 11,800 per 10 gram respectively.

Sovereign too maintained yesterday's record high levels at Rs 9,475 per piece of eight gram.

Gold, Silver Prices Drop

Mumbai: Gold prices that touched Rs 12,000 per 10 gm on Tuesday came down a tad and were quoted at Rs 11,900 per 10 gm in the local bullion market on Wednesday. Gold price closed at Rs 11,785 per 10 gm on Wednesday against Rs 11,845 per 10 gm on Tuesday.

The Rs 12,000 per 10 gm mark was reached for the first time ever in the country.

Gold price in the international market touched an all time high of $927.50 an ounce on Tuesday came down to $923.75/oz on Wednesday in the London spot market.

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The gold market both international as well as national is awaiting the outcome of the FOMC meeting on Wednesday. The price should correct to about $902/oz in the event of rates remaining unchanged and should go up to $946/oz if there is a rate cut, said Suresh Hundia, President of Bombay Bullion Association.

Silver for immediate delivery in London rose as much as 12 cents to $16.84 an ounce, the highest since November 1980. It traded at $16.76 an ounce as of 11:56 a.m. local time.

Gold, Silver Prices Recover

Mumbai: Bullion market returned to a positive tone on the international development of a 75 basis point cut in interest rates by the US Fed.

Gold price in the London was fixed at $887.80 an ounce (A.M. fixing) on January 23, up from $862 /oz (A.M. fixing) and $875/oz (P.M. fixing) on January 22.

In a mirror reflection of the international market, domestic gold prices were quoted at Rs 11,370 per 10 gm on January 23 up from Rs 11,055 per 10 gm the previous day.

Despite the price level being near the psychological Rs 11,000-mark, there was some buying at the trade level.

In the domestic market, silver prices recovered and closed at Rs 20,570, a gain of Rs 420.

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During the last two days, there have been reports of wholesalers purchase to the tune of a couple of tonnes across the country by some banks, said Ajay Mitra, Managing Director of World Gold Council, India. However, overall offtake of the yellow metal has been mixed in the country, he added.

RiddiSiddhi Bullions Ltd, which introduced online trading in gold this month, said it is seeing 40 to 50 kg delivery per day in Mumbai and Ahemdabad.

“Demand is subdued as there is no seasonal buying as the prices are high,” said Prithviraj Kothari of RiddiSiddhi Bullions.

Currently, the firm has registered about 100 clients for online buying and selling of gold and expects about 300 kg turnover per day across all centres as prices soften and settle in at a level.

“We have seen some demand pick up with the dip in prices and we have booked some fresh consignments as we see some buying potential ahead,” said a bank official of Axis Bank.

Prices have to come further within a narrow price range to see heavy demand from wholesalers as well as retailers, said Moses Harding of Indusind Bank.

At the jewellery retail level, there has been a slight rush in buying as buyers feel the need to rush in their buying in expectation of further escalation of prices, said Ankit Gala, Director of Antara Jewellery Pvt Ltd.

But as prices have come off from the Rs 11,500 plus level, the market has not witnessed much scrap sales, said a scrap trader in Zaveri Bazaar.

Scrap sales came down to less than half from what was witnessed at the time prices where at the peak, he added. Today the scraps are sold at Rs. 11,000 per 10 gm.

Gold, Crude Poised To Test Further Upside In 2008

Mumbai: Bullion trading witnessed choppy conditions last week with gold and silver prices rallying to newer heights in New York and London markets. The Fed Chairman, Bernankes’ speech and the weaker dollar let gold prices steam ahead to test $894.9 an ounce on Thursday when gold closed at another all-time high of $892.7/oz and on Friday extended the gains to test $898/oz.

There were reports of the February contract on Comex breaking $900/oz. Continuing to take a cue from gold, silver rallied to close at a 27-year high of $16.16/oz. Platinum prices too tested all-time highs ($1,563/oz), buoyed by strong fundamentals.

In the London market, on Friday, the gold PM Fix was $891, up from the previous day’s $884.25. Silver too spurted to $16.06 from $15.62 (AM Fix).

Experts are revising their 2008 gold price forecast up. Gold prices are set to post positive gains for the seventh consecutive year on an annual average basis. The market fundamentals remain tightly balanced and external drivers remain positive. However, it is investor demand that is key to price strength.

Investor interest

Having tasted success, investor interest is expected to continue through 2008. Factors supportive of further gold price strength include higher inflationary expectations, broader economic concerns, geopolitical tensions and possibility of Fed rate easing.

Technical analysts assert, on both short-and medium-term charts, gold is poised for further gains this week. Old resistance levels are now turning fresh support levels, the evidence of a healthy uptrend. A run at 900 seems imminent. In the medium-term, a closing break of 850 indicates that the uptrend has resumed a run towards 1,000 in 2008, and potentially beyond.

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Platinum is seen a bellwether for precious metals in general. The near-term support is at 1518, and the outlook remains positive. In India, gold prices continue to reflect international trends. However, the sharp upward movement in prices is seen driving retail buyers and actual consumers away. There is demand resistance at the current levels of over Rs 11,000 per 10 grams. However, speculators holding long positions on the bourses have benefited immensely from the ongoing bull run. Trading volumes are expected to continue to be robust so long as the price rally holds.

Base metals

Last week, zinc fell by 4.5 per cent (even though it was the metal with the most index fund buying), while copper gained the most, up by 5.9 per cent. The latest set of OECD lead indicators point to a weakening outlook for OECD industrial production growth during the first half of 2008. At the global level, the sharp drop in the six-month rate of change in lead indicators has resulted in major economies moderating from 5.7 per cent in May to the (still solid) level of 3.2 per cent in November.

World industrial output growth is likely to continue to slow until the middle of 2008, experts have pointed out.

This will have implications for metals prices because the markets are vulnerable to growth concerns. However, weaker dollar and prospect for additional volumes of base metals buying have lent a positive start to the year. As far-forward prices are strong, it is reasonable to believe that market participants perceive the nearby price weakness as a temporary feature. Any slowdown in the US metals demand may be offset by the strength of growth in other parts of the world. Inventory levels need to be watched constantly.

Crude: The global oil market continues to tighten with stocks in major OECD countries including the US, Europe and Japan showing deterioration. In the US, crude oil stocks have continued to widen their gap to the 5-year average and are now some 30 million barrels below last years level.

Looking into 2008, global oil balances are likely to undergo further tightening. The constructive picture for 2008 suggests annual average of oil prices will rise again for the seventh year in succession. From the 2007 average, prices of WTI and Brent are likely to rise by $13-15 a barrel in the current year.

Admittedly demand growth prospects have turned somewhat uncertain due to deteriorating macroeconomic conditions; however, there exist severe supply-side constraints which could force prices to move up. The potential of supply growth from non-OPEC regions is rather limited primarily due to accelerating decline rates at ageing oil fields.