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Commodities Precious Metals

Gold and silver daily review (July 15, 2014)

July 15, 2014, Tuesday, 06:32 GMT | 01:32 EST | 11:02 IST | 13:32 SGT
Contributed by Angel Broking


Gold

Spot gold prices declined by more than 2 percent on Monday as receding fears over Portugal's banking sector and a gain in U.S. equities prompted investors to take profits after bullion's rally to 3-1/2 month highs last week.

Gold rallied to near $1,350 an ounce last Thursday after questions about the health of Portugal's top-listed bank sparked worry that a new euro zone banking crisis might be in the offing. Portuguese bond yields fell on Monday after the country's biggest bank took steps aimed at reassuring investors of its stability, calming peripheral debt markets after their first episode of contagion this year.

On the MCX, gold prices declined by 2.09 percent and taking cues from weak international markets and closed at Rs.27762/10gms.


Silver

Weakness in gold prices as Portugal fears receded led to a bout of selling as spot silver prices declined by 2.4 percent in yesterday’s session and closed at $20.9/oz. Decline in Nickel and Copper prices further exerted downside pressure on prices.

On the MCX, silver prices declined by 2.5 percent taking cues from weak international markets and closed at Rs.44912/kg.


Outlook

On an intraday basis, we expect gold and silver prices to trade negative continuing its decline from the previous trading session as investors put the banking fears from Portugal at the back seat. The Portuguese banks assurance to take steps to reassure investor’s stability builds in confidence in the economy that the contagion would not likely spread across the Euro-zone. The optimism about the US economy gains traction as the recent economic data sets from the country suggests that US is on a path of growth trajectory which in turn can exert downside pressure on the precious metals pack

On the MCX, gold and silver prices are expected to trade on negative note taking cues from weak international markets.

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