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Informist, Friday, Dec. 13, 2024

By Sandeep Sinha

MUMBAI – Futures contracts of gold fell on the Multi Commodity Exchange of India, despite steady cues from COMEX, following profit sales from the recent high. The sentiment was also weighed down by gold exchange-traded funds witnessing outflows.

On Friday, GOLD holdings with the SPDR Gold Trust, the world's largest gold-backed ETF, fell by 4.88 tonnes to 868.50 tonnes. The fund has a market value of $74.95 billion. On the National Stock Exchange, the total value of gold ETFs traded Friday was INR 1.19 billion, up from INR 975.9 million Thursday.

"Gold witnessed a sharp sell-off as profit booking intensified following mixed signals from US economic data. While the US Producer Price Index data came in lower, higher weekly jobless claims prompted a retreat in gold prices on COMEX," Jateen Trivedi, vice-president and research analyst at LKP Securities, said in a note. "The current weakness suggests a potential trading range of INR 76,000–78,000 in MCX, with the short-term outlook remaining cautious amid ongoing market volatility," he said.

At 1900 IST, the most-active February gold contract on the MCX was down 0.8% at INR 77,363 per 10 gm. The most-active February contract on COMEX was 0.9% at $2,686.0 per ounce. The highest call open interest for gold was at the INR 79,000-80,000 strike price, suggesting a bullish view. The highest put open interest was at the INR 75,000-74,000 strike for the Dec. 31 contract.

However, the downside in the yellow metal was cushioned by weakness in the dollar, which makes commodities priced in the greenback cheaper for holders of other currencies. At 1847 IST, the dollar index, which measures the strength of the greenback against a basket of major currencies, was down 0.2% at 106.77.

SILVER prices fell, taking cues from COMEX and weakness in gold. At 1900 IST, the most-active March contract of silver on the MCX was down 1.4% at INR 91,356 per kg. The same-month contract on COMEX was 1.5% lower at $31.13 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 98 points at 18942 points. At 1855 IST, the February and April gold contracts recorded turnovers of INR 40.11 billion and INR 1.96 billion, respectively. The March and May silver contracts saw turnovers of INR 28.33 billion and INR 1.18 billion, respectively.

The spot gold-silver ratio, also known as the Mint ratio, rose to 86.68 Friday, indicating that gold had outperformed silver. The ratio measures the ounces of silver required to buy an ounce of gold. The ratio was 85.26 on Thursday.

Outlook for the rest of the session:

--MCX gold seen at INR 76,900–78,780 per 10 gm

--COMEX gold seen at $2,680.0–$2,710.0 an ounce

--MCX silver seen at INR 89,700-94,000 per kg

--COMEX silver seen at $30.90-$32.77 an ounce

End

US$1 = INR 84.79

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

Edited by Rajeev Pai

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