More Stories

Informist, Friday, Oct. 11, 2024

By Sandeep Sinha

MUMBAI – Futures contracts of gold on the Multi Commodity Exchange of India rose, taking cues from COMEX, because of heightened geopolitical tensions in West Asia as Israel continued its military offensive in Lebanon. The sentiment was further aided by the expectation of festival demand in India and hopes of further interest rate cuts by the US Federal Reserve.

Jewellers are expecting gold sales to pick up on the weekend because of Dussehra, which is one of the major Hindu festivals. Purchasing gold jewellery or coins on Dussehra is considered to bring wealth and prosperity.

The US Labour Department data released on Thursday showed that the number of citizens claiming jobless benefits rose by 33,000 to 258,000 in the week ended Oct. 5 against analysts’ expectation of 230,000 polled by Dow Jones. "The key drivers for the ongoing positive trend in gold include US data that supports the continuation of interest rate cuts, particularly due to high jobless claims and elevated crude oil prices, which indicate persistent inflationary pressures" said Jateen Trivedi, vice-president and research analyst at LKP Securities, in an email note.

At 1933 IST, the most active December GOLD contract on the MCX was up 1% at INR 76,045 per 10 gram. The most active December contract on COMEX was 1% higher at $2,664.6 per ounce. The highest call open interest for gold was at the INR 77,000 strike price, suggesting a bullish view, while the highest put open interest was at the INR 73,000 strike for the Nov. 26 gold contract.

"The correction on the gold market is probably largely over. Finally, interest rates will be cut further around the world, which will reduce opportunity costs," Commerzbank said in a note.

Gold holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, remained unchanged for the fourth day at 876.26 tonnes. The fund has a market value of $74.03 billion.

SILVER prices rose, taking cues from COMEX, and positive trends in gold and base metals. The industrial metals rallied on expectation of further stimulus announcements from China's Finance Minister Lan Fo'an press briefing on Saturday. At 1937 IST, the most active December contract of silver on the MCX was up 1.3% at INR 91,464 per kilogram. The same-month contract on COMEX was 1.4% higher at $31.68 per ounce.

The MCX Bulldex, an index that tracks the real-time performance of gold and silver futures on the MCX, was up by 164 points at 1895 points. As of 1938 IST, the December and February gold contracts recorded turnovers of INR 32.44 billion and INR 2.31 billion, respectively, on the MCX. The December and March silver contracts saw turnovers of INR 28.66 billion and INR 1.42 billion, respectively.

The spot gold-silver ratio, also known as the Mint ratio, fell to 84.43, indicating that gold underperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 85.53 on Thursday.

Outlook for the rest of the session:

--MCX gold seen at INR 75,600–INR 76,200 per 10 gm

--COMEX gold seen at $2,627.77–$2,668.43 an ounce

--MCX silver seen at INR 90,200-INR 92,300 per kg

--COMEX silver seen at $30.83-$31.95 an ounce

End

US$1 = INR 84.06

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

Edited by Akul Nishant Akhoury

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2024. All rights reserved.