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Informist, Tuesday, Dec. 10, 2024

By Sandeep Sinha

MUMBAI – Futures contracts of gold rose on the Multi Commodity Exchange of India and COMEX as Syrian rebels ousted Bashar al-Assad's government, which led to increased turbulence in West Asia and supported safe-haven demand for bullion. However, further upside in the yellow metal was restricted by outflows in gold exchange-traded funds and continued strength in the dollar, which makes commodities priced in the greenback expensive for holders of other currencies.

At 1820 IST, the dollar index, which measures the strength of the greenback against a basket of major currencies, was up 0.2% at 106.37.

On Monday, GOLD holdings with the SPDR Gold Trust, the world's largest gold-backed ETF, fell by 1.15 tonnes to 870.79 tonnes. The fund has a market value of $74.80 billion. On the National Stock Exchange, the total value of gold ETFs traded on Tuesday was INR 1.17 billion, up from INR 888.9 million on Monday.

"Gold prices exhibited minor movement following Monday's strong rally, trading sideways as participants await Wednesday's US CPI data. The data is expected to provide clarity on the future trend," Jateen Trivedi, vice-president and research analyst at LKP Securities, said in a note. While the overall bullish outlook for gold remains intact, the sharp pre-event rally suggests caution, he said.

At 1820 IST, the most-active February contract of gold on the MCX was up 0.5% at INR 77,894 per 10 grams. The most-active February contract on COMEX was up 0.6% at $2,700.60 per ounce. The highest call open interest was at INR 79,000-80,000 strike prices, suggesting a bullish view on gold. The highest put open interest was at INR 76,000-74,000 strikes for the Dec. 31 gold contract.

SILVER prices fell, taking cues from COMEX on profit sales and weakness in industrial metals. At 1820 IST, the most-active March contract of silver on the MCX was down 0.2% at INR 95,058 per kg. The same-month contract on COMEX was 0.3% lower at $32.52 per ounce.

On the options front, the highest call open interest was at INR 100,000 strike price. The highest put open interest was at INR 90,000 strike for the Feb. 24 expiry.

The MCX Bulldex, an index that tracks the real-time performance of gold and silver futures on the MCX, was down 32 points at 19080 points. At 1818 IST, the February and April gold contracts recorded turnovers of INR 27.54 billion and INR 3.74 billion, respectively, on the MCX. The March and May silver contracts saw turnovers of INR 21.47 billion and INR 913.2 million, respectively.

The spot gold-silver ratio, also known as the Mint ratio, rose to 84.0 on Tuesday, indicating that gold had outperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 83.77 on Monday.

Outlook for the rest of the session:

--MCX gold seen at INR 76,800–78,500 per 10 gm

--COMEX gold seen at $2,661.0–$2,705.06 an ounce

--MCX silver seen at INR 93,800-96,200 per kg

--COMEX silver seen at $31.80-$33.16 an ounce

End

US$1 = INR 84.85

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

Edited by Rajeev Pai

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