Commodities

Gold and silver daily review (October 03, 2012)

Contributed by Angel Broking

Gold

Spot gold prices swung between gains and losses and settled on a flat note. Spot gold prices have initially witnessed selling pressure triggered by concerns o f Spain finances. Spain Prime Minister had earlier stated that the nation had no plans to ask for the rescue funds in the near term. Market participants were speculating that once Spain asks for the bailout it could pave way for the European Central Bank to buy its debt and thereby helping in containing the Euro zone debt. But, rise in the risk appetite led prices to erase earlier losses and settled with marginal gains of 0.01 percent in the later part of yesterday's session. Weakness in the DX also supported an upside in the gold prices.

The yellow metal touched a high of $1,784.20/oz and closed at $1,774.14/oz on Tuesday. MCX exchange remained closed on the occasion of Gandhi Jayanti on Tuesday. On Monday October 01, 2012 Gold prices on the MCX closed at Rs.31,033/10 gms after touching a low of Rs. 30,975/10 gms on Monday due to appreciation in the Indian Rupee.

Silver

Spot silver prices declined 0.1 percent in yesterday's session taking cues from mixed movement in the spot gold prices and bearishness in the base metals pack except copper. Weakness in the DX however cushioned sharp fall in the prices.

The white metal touched an intra-day high of $34.78/oz and closed at $34.68/oz on Thursday. MCX exchange remained closed on the occasion of Gandhi Jayanti on Tuesday. However on Monday October 01, 2012, MCX silver prices gained 0.2 percent taking cues from strength in the spot prices. However, appreciation in the Indian rupee capped sharp gains on MCX. Silver prices closed at Rs. 62,934/kg after touching a high of Rs.64,999/kg on Monday.

Outlook

In today's session, we expect precious metals to trade with a negative bias on the back of mixed market sentiments along with uncertainty in Euro zone area. Mixed trend in the DX is also expected to exert downside pressure on the precious metals. In the domestic markets appreciation in the Indian rupee will act as a bearish factor for the precious metals on the MCX.