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Informist, Tuesday, Sep 17, 2024

By Sandeep Sinha

MUMBAI – Futures contracts of gold on the Multi Commodity Exchange of India fell, taking cues from the COMEX, because of profit-taking at higher levels. The rebound in the dollar after stronger-than-expected US retail sales data also weighed on yellow metal prices.

The dollar index, which measures the strength of the greenback against a basket of major currencies, was up 0.1% at 100.76. A stronger dollar makes commodities priced in the greenback expensive for holders of other currencies.

The US Census Bureau data today showed that the country's retail sales rose 0.1% on month in August against the expectation of a 0.2% decline. The stronger economic data has lowered the bets of a 50-basis-point cut by the US Federal Reserve.

At 1815 IST, the most active October gold contract on the MCX was down 0.4% at 73,217 rupees per 10 gm. The most active December contract on COMEX was 0.3% lower at $2,601.90 per oz. The highest call open interest for gold was at the 74,000-75,000-rupee strike price, suggesting a bullish view, while the highest put open interest was at the 72,000-71,000-rupee strike for the Sep 24 gold contract.

The downside in gold was cushioned by fresh inflows in gold exchange-traded funds and strong imports in India. On Monday, gold holdings with SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, rose by 1.72 tn to 872.23 tn. The fund has a market value of $72.45 bln.

India imported $10.06 bln worth of gold in August, more than three times of $3.13 bln in July, data released by the Ministry of Commerce and Industry showed today. India is the second-biggest importer of gold globally, behind China.

SILVER prices fell, taking negative cues from the COMEX, and weak trends in gold and industrial metals. At 1835 IST, the most active December contract of silver on MCX was down 0.3% at 89,328 rupees per kg. The same-month contract on COMEX was 0.2% lower at $31.09 per oz.

The MCX Bulldex, an index that tracks the real-time performance of gold and silver futures on the MCX, was down 42 points at 18390 points. As of 1835 IST, the October and December gold contracts recorded turnovers of 29.74 bln rupees and 8.55 bln rupees, respectively, on MCX. The December and March contracts of silver saw turnovers of 15.47 bln rupees and 620.2 mln rupees, respectively.

The spot gold-silver ratio, also known as the Mint ratio, rose to 83.73, indicating that gold outperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 83.36 on Monday.

Outlook for the rest of the session:

--MCX gold seen at 72,800–73,700 rupees per 10 gm

--COMEX gold seen at $2,588.00–$2,617.40 an oz

--MCX silver seen at 88,500-90,500 rupees per kg

--COMEX silver seen at $30.86-$31.67 an oz

End

US$1 = 83.75 rupees

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

Edited by Saji George Titus

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