Informist, Tuesday, Jul 18, 2023
By Sandeep Sinha
MUMBAI – Futures contracts of gold on the Multi Commodity Exchange of India rose today, tracking firm cues from the COMEX amid safe-haven demand.
The dollar index, which measures the strength of the greenback against a basket of six major currencies, was down 0.2% at 99.67, the lowest since April 2022. A weaker greenback makes precious metals priced in dollars attractive for holders of other currencies.
“Safe haven demand supports gold prices to move higher after China’s second-quarter growth missed estimates, adding to worries about a slowdown in the world’s second-largest economy,” said Saumil Gandhi, senior analyst-commodities at HDFC Securities.
Gandhi expects gold prices to consolidate within a range with a positive bias.
However, the upside in the yellow metal was restricted by outflow from gold exchange-traded funds and weak demand from top consumers China and India. Gold holdings with SPDR Gold Trust, the world’s largest gold backed exchange-traded fund, fell by 1.73 tn to 912.93 tn. The fund has a market value of $57.21 bln.
Buyers in both India and China are refraining from buying gold jewellery due to record high local prices and concerns about an economic slowdown.
The spot gold-silver ratio, also known as the mint ratio, was at 78.84, indicating that silver had outperformed gold. The ratio measures the ounces of silver required to buy an ounce of gold.
SILVER prices rose due to expectations of higher demand and a supply deficit in the global market.
At 1630 IST, MCX Bulldex, an index tracking the real-time performance of gold and silver futures on the MCX, was up 71 points, or 0.4%, at 16169.
The August and October gold contracts recorded turnovers of 10.37 bln rupees and 2.35 bln rupees, respectively. At 1630 IST, the September and December silver contracts saw turnovers of 8.37 bln rupees and 308.05 mln rupees, respectively.
The average traded price for the August gold contract during the day on the domestic exchange was 59,295.02 rupees per 10 gm.
On technical charts, the MCX August gold contract traded higher than the five-, 20-, 100- and 200-day simple moving averages, but was lower than the 50-day simple moving average on the daily chart. The momentum oscillator, Relative Strength Index, was at 58.14, indicating further upside in prices.
At 1630 IST, following were the most active contracts of bullion:
-August gold was up 0.4% at 59,355 rupees per 10 gm on MCX
-August gold was up 0.5% at $1,966.85 an ounce on COMEX
-September silver was up 0.3% at 75,771 rupees per kg on MCX
–September silver was up 0.4% at $25.10 an ounce on COMEX
Outlook for the rest of the session:
-MCX gold seen at 58,900–59,700 rupees per 10 gm
-COMEX gold seen at $1,960.0–$1,970.0 an ounce
-MCX silver seen at 74,700-76,700 rupees per kg
-COMEX silver seen at $24.95-$25.20 an ounce
End
US$1 = 82.03 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Avishek Dutta
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