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Informist, Monday, Sep 2, 2024

By Sandeep Sinha

MUMBAI – Futures contracts of gold rose on the Multi Commodity Exchange of India and the COMEX today because of a weak dollar, which makes commodities priced in the greenback cheaper for holders of other currencies. The positive sentiment was further aided by inflows in exchange-traded funds.

At 1600 IST, the dollar index, which measures the strength of the greenback against a basket of major currencies, was down 0.1% at 101.66.

On Friday, gold holdings with SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose by 5.47 tn to 862.74 tn. The fund has a market value of $69.69 bln.

"Commodities broadly are stuck in a range after an initial negative start, as traders look for fresh cues after last week's US PCE inflation data was in line with expectation while another data showed the economic growth remained strong - pushing down the odds for any bigger rate cut from the Federal Reserve at their next meeting," Pranav Mer, vice president research commodity and currency at BlinkX and JM Financial said in a note. "Focus during the week will be on the manufacturing/ services purchasing managers’ index data from across regions, and the US nonfarm payrolls/ unemployment data on Friday," Mer said.

At 1606 IST, the most-active October gold contract on the MCX was up 0.1% at 71,645 rupees per 10 gm. The most-active December contract on the COMEX was 0.2% higher at $2,533 per oz. The highest call open interest for gold was at the 72,000-75,000-rupee strike, suggesting a bullish view, while the highest put open interest was at the 68,000-rupee strike for the Sep 24 gold contract.

The volume will likely be lower today as the US bank and equity markets are shut for the Labor Day Holiday, while electronic trading in commodities remains open.

SILVER prices fell on the MCX, taking cues from the COMEX and weak trends in industrial metals. At 1612 IST, the most-active December contract for silver on the MCX was down 0.5% at 84,820 rupees per kg. The same-month contract on the COMEX was 0.4% lower at $29.02 per oz.

The MCX Bulldex, an index that tracks the real-time performance of gold and silver futures on the MCX, was down just 24 points at 17876 points. As of 1615 IST, the October and December contracts of gold recorded turnovers were 14.79 bln rupees and 1.81 bln rupees, respectively, on the MCX. The September and December contracts of silver saw turnovers of 87.92 mln rupees and 14.81 bln rupees, respectively.

Outlook for the rest of the session:

--MCX gold seen at 70,800–72,302 rupees per 10 gm

--COMEX gold seen at $2,500.00–$2,550.00 an oz

--MCX silver seen at 83,687-87,839 rupees per kg

--COMEX silver seen at $28.66-$29.80 an oz

End

US$1 = 83.92 rupees

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

Edited by Vidhi Verma

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