MCX Gold Tips: Gold futures ended lower in the Asian market on Monday as investors and speculators exited positions in the expansive metal tracking weakness in the overseas market as a renewed oil rout signaled weaker global inflationary pressures, dimming the appeal of the yellow metal, which is a hedge against rising prices.
Oil shed more than 3% on Monday as focus returned to a global supply glut and worries over weak demand from China weighed after the country’s industrial profits slid for a sixth straight month in Nov.
Slight gains in the dollar also dimmed the luster for Gold, which has an inverse trading relationship with the greenback. Strength in the greenback makes dollar-denominated commodities including the bullion more expensive for those holding other currencies, thus curbing their demand.
Thin participation in the overseas market amidst the ongoing holiday season also weighed on sentiment.
Traders stayed on the sidelines ahead of key US economic releases later this week including consumer confidence, pending home sales & household spending which may offer further cues over the health of the universally biggest economy, determining the outlook for US interest rates in 2016.
Gold may extend losses today as traders stay cautious ahead of US consumer confidence and home prices data later in the session.
At the MCX, Gold futures for February 2016 contract closed at Rs 25,125 per 10 gram, down by 0.35 per cent after opening at Rs 25,193, against the last closing price of Rs 25,212. It touched the intra-day low of Rs 25,111.
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