Gold, silver futures rebound on value buying after steep sell-off

NEW DELHI: Gold and silver futures recovered on Thursday after witnessing a sharp sell-off in the previous sessions, as traders indulged in value buying amid easing global tensions and improving risk sentiment.

On the Multi Commodity Exchange (MCX), gold futures for December delivery increased by Rs 1,800, or 1.48 per cent, to Rs 1,23,657 per 10 grams in a business turnover of 13,158 lots. Silver futures also rebounded after facing a sharp sell-off in the previous sessions, by surging Rs 2,727, or 1.87 per cent, to Rs 1,48,285 per kilogram in 20,868 lots.

On Wednesday, gold futures had plunged by Rs 6,414, or 5 per cent to close at Rs 1,21,857 per 10 grams while silver dropped by Rs 4,769, or 3.17 per cent to settle at Rs 1,45,558 per kilogram as profit-booking intensified after a strong rally.

The sharp fall also followed gains in the US dollar and fading safe-haven demand amid improving global risk sentiment, analysts said.

Commodity markets remained shut during the first half of Wednesday and resumed trading in the evening session.

On Tuesday, a special muhurat trading session, a symbolic one-hour trading exercise was conducted by stock and commodity exchanges, marked the beginning of Samvat 2082 this year. The session was conducted across BSE, NSE, MCX and NCDEX. During the special one-hour Muhurat trading, gold futures had depreciated by Rs 2,353, or 1.8 per cent, to finish at Rs 1,28,271 per 10 grams against the Monday’s closing of Rs 1,30,624 per 10 grams.

Silver also slumped by Rs 7,660, or 4.85 per cent, to end at Rs 1,50,327 per kg on Tuesday from the previous close of Rs 1,57,987 per kilogram on the MCX.

Analysts said gold and silver came under heavy selling pressure this week due to easing tensions between the US and China.

“At the end of the Diwali festival in India, the world’s second-largest gold consumer, physical demand has eased, dragging prices lower. Expectations of progress on a potential US government funding deal and the upcoming inflation data further weighed on sentiment,” an expert said.

Both gold and silver in the domestic futures trade had hit record highs of Rs 1,32,294 per 10 grams and Rs 1,70,415 per kilogram, respectively, on Friday on the commodities bourse. On the global front, Comex gold futures for December delivery rose by USD 73.44, or 1.81 per cent, to USD 4,138.84 per ounce. It had hit a fresh peak of USD 4,398 per ounce on Monday.

Gold hovers around USD 4,130 per ounce, down 6 per cent from recent highs, amid US-China trade optimism; silver rises 0.89 per cent to USD 48.10, supported by easing trade tensions and

industrial demand.