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Commodities Precious Metals

Gold and silver daily review (January 31, 2014)

January 31, 2014, Friday, 09:32 GMT | 04:32 EST | 15:02 IST | 17:32 SGT
Contributed by Angel Broking


Gold
 
Spot gold prices declined around 1.9 percent yesterday on the back of mixed market sentiments after QE tapering of $10 billion by the Federal Reserve. Further, strength in the DX exerted downside pressure on the prices.
 
However, sharp downside in the prices was prevented due to rise in SPDR gold holdings by 0.1 percent to 793.16 tonnes. The yellow metal touched an intra-day low of $1237.94/oz and closed at $1243.30/oz on in yesterday’s trading session.
 
On the domestic bourses, the near-month gold contract slipped around 1.2 percent and closed at Rs.29378/10gm after touching an intra-day low of Rs.29353/10gm on Thursday. Depreciation in the Rupee prevented sharp downside in the prices on the MCX.
 
 
Silver
 
Taking cues from fall in gold prices along with downside in base metals complex, Spot Silver prices dropped by more than 3 percent yesterday. Further, strength in the DX exerted downside pressure on the prices. The white metal touched an intra-day low of $18.97/oz and closed at $19.10/oz in yesterday’s trade.
 
In the Indian markets, the near-month silver futures contract on the MCX fell around 2.7 percent and closed at Rs.43220/kg after touching an intra-day low of Rs.43080/kg on Thursday. Depreciation in the Rupee prevented sharp downside in the prices on the MCX.
 
 
Outlook
 
Over the trade, we expect precious metals to trade on a negative note as a result of weak market sentiments after QE tapering of $10 billion by the Federal Reserve. Further, strength in the DX will exert downside pressure on the prices. However, sharp downside in the prices will be prevented due to rise in gold and silver ETF holdings. In the Indian markets, Rupee appreciation will continue with downside pressure on the prices.

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