Commodities

Gold and silver daily review (January 10, 2013)

Contributed by Angel Broking

Gold

Spot gold prices swung between gains and losses and ended 0.1 percent lower in yesterday's session. Improved physical buying by the Asian markets led prices to remain firm in the first half of the session. But, strength in the DX exerted downside pressure on the gold prices and ended lower on Wednesday. Further, investors adopted a cautious approach ahead of the European Central Bank meeting to be scheduled on Thursday. This led to rise in the risk aversion in the global markets and pressurized the gold prices towards the end of the session.

The yellow metal touched an intra-day low of $ 1650.84/oz and closed at $ 1,657.3 per ounce on Wednesday. On the MCX, Gold February contract ended 0.6 percent lower tracing the trend in the spot gold prices and appreciation in the Indian rupee. Gold prices on the MCX closed at Rs. 30,794/10 gms on Wednesday after touching a low of Rs. 30,772/ 10gms.

Silver

Spot silver prices ended on a flat note taking cues from firmness in the spot gold prices and weakness in the base metals pack. Strength in the DX also restricted gains in the silver prices in yesterday's session.

The white metal touched an intra-day low of $ 30.52/oz and closed at $ 30.3 per oz on Wednesday. In the Indian markets, MCX silver prices fell 0.9 percent and closed at Rs. 57,970/kg on Wednesday and touched an intra-day low of Rs. 57,705/ kg. Appreciation in the Indian rupee also exerted downside pressure in the silver prices on MCX.

Outlook

In today's session, we expect precious metals to trade lower as investors are adopting cautious approach before European Central Bank meeting to be scheduled in the later part of the day. ECB is expected to keep the interest rates steady. Strength in the DX is also likely to add to the losses. However, positive global market sentiments are expected to cushion fall in the precious metals. In the domestic markets, appreciation in the rupee is expected to act as bearish factor for the MCX precious metals.