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Informist, Monday, Aug 12, 2024

By Sandeep Sinha

MUMBAI – Futures contracts of gold were trading higher today on the Multi Commodity Exchange of India, tracking those on the COMEX, because of fresh inflows in exchange-traded funds. Market participants are awaiting the US consumer price index data, due later this week, for further cues on the US Federal Reserve’s interest rate trajectory.

On Monday, gold holdings with SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose 1.44 tn to 846.91 tn. The fund has a market value of $66.06 bln.

At 1915 IST, the most active October GOLD contract on the MCX was up 0.7% at 70,373 rupees per 10 gm. The same-month contract on COMEX was 0.7% higher at $2,468.6 per ounce. 

On the options side, the highest call open interest for gold was at 70000-74,000 strike, while on the downside, the highest put open interest was at 68000-65000 strike for MCX Sep 24 gold contract.

"The strength in gold is largely driven by escalating Middle East tensions, particularly concerns over a potential attack by Iran on Israel. Geopolitical uncertainties often bolster gold as a safe-haven asset, providing support during such volatile times," Jateen Trivedi, vice-president and research analyst at LKP Securities, said in an email note.

SILVER prices rose, taking firm cues from the COMEX, and positive trends in gold and industrial metals. At 1925 IST, the most active September contract for silver on the MCX was up 1.3% at 81,567 rupees per kg. The same-month contract on the COMEX rose 1.3% to $28.36 per oz.

The MCX Bulldex, an index that tracks the real-time performance of gold and silver futures on the MCX, was up 141 points at 17600 points. As of 1927 IST, the October and December contracts of gold recorded turnovers of 28.36 bln rupees and 2.62 bln rupees, respectively, on the MCX. At the same time, the September and December contracts of silver saw turnovers of 33.02 bln rupees and 5.59 bln rupees, respectively.

The spot gold-silver ratio, also known as the Mint ratio, was lower at 88.14, which indicates that gold underperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 88.55 on Friday.

Outlook for the rest of the session:

--MCX gold seen at 69,700–70,600 rupees per 10 gm

--COMEX gold seen at $2,454–$2,484 an oz

--MCX silver seen at 80,350-83,000 rupees per kg

--COMEX silver seen at $28.20-$28.50 an oz

End

US$1 = 83.97 rupees

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Saji George Titus

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