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Informist, Monday, Sept. 30, 2024

By Sandeep Sinha

MUMBAI – Futures contracts of gold fell on the Multi Commodity Exchange of India and COMEX Monday because of outflows seen in exchange-traded funds. However, the downside to the precious metal was cushioned by the heightened geopolitical tensions in West Asia, which boosted safe-haven demand.

Gold holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, fell by 5.18 tonne Friday  to 871.94 tonne, the biggest one-day decline since Mar. 26. The fund has a market value of $74.6 billion.

At 1925 IST, the most active December GOLD contract on the MCX was down 0.3% at INR 74,503 per 10 gm. The most active December contract on COMEX was 0.4% lower at $2,657.4 per ounce. The highest call open interest for gold was at INR 77,000 strike price, suggesting a bullish view, while the highest put open interest was at INR 73,000 strike for the Nov 26 gold contract.

Investors will take cues from Federal Reserve Chair Jerome Powell’s speech at the National Association for Business Economics conference later Monday.

"Gold prices remained range-bound as the market braces for a series of crucial data releases this week. Profit booking could dominate the week as the market weighs the likelihood of additional rate cuts from Fed Chair Jerome Powell, with a total of 1% expected in 2024 following the 0.50% cut on Sep. 18," Jateen Trivedi, vice-president and research analyst at LKP Securities, said in an email note. "There is growing anticipation of another 0.50% cut in the next meeting, but participants are cautious. If upcoming unemployment data shows strong figures, the Fed might take a less aggressive stance, which could temper gold's momentum," Trivedi said.

SILVER prices fell, taking cues from the COMEX, and trends in gold and industrial metals. At 1935 IST, the most active December contract of silver on MCX was down 1.1% at INR 90,333 per kg. The same-month contract on COMEX was 1.8% lower at $31.26 per ounce.

The MCX Bulldex, an index that tracks the real-time performance of gold and silver futures on the MCX, was down 68 points at 18775 points. As of 1938 IST, the December and February gold contracts recorded turnovers of INR 37.87 billion and INR 5.73 billion, respectively, on MCX. The December and March contracts of silver saw turnovers of INR 36.76 billion and INR 1.65 billion, respectively.

Outlook for the rest of the session:

--MCX gold seen at INR 74,200–INR 75,450 per 10 gm

--COMEX gold seen at $2,649.40–$2,696.70 an ounce

--MCX silver seen at INR 89,003-INR 92,188 per kg

--COMEX silver seen at $31.09-$32.45 an ounce

End

US$1 = INR 83.79

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

Edited by Deepshikha Bhardwaj

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