Gold likely to stay lower amid Greece uncertainty
Mumbai-India (Feb 11) European markets are trading lower today as euro zone meetings on the Greek debt crisis threatened to give rise to confusion rather than clarity. Asian markets ended on a mixed note and the US stock futures are trading in the red.
Gold inched up on Wednesday as the dollar took a breather after recent sharp gains and as caution prevailed in financial markets regarding Greece's future in the euro zone. The uncertainty over Greece debt issues has somewhat helped gold in recent days, but it is still down nearly 4 percent so far this month as a strong dollar and expectations of an interest rate hike in the United States have hurt the metal. Spot gold rose 0.3 percent to $1,237 an ounce by 4 PM IST. On the MCX, gold prices are trading marginally higher by 0.07 percent and trading at Rs.26875/10 gms.
Spot silver prices are trading higher by around 0.3 percent at $17.05/oz. Weak dollar and strength in copper prices is acting as a positive factor for prices. On the MCX, silver prices are trading higher by 0.31 percent at Rs.37715/kg.
LME Copper prices rose by 0.5 percent owing to news that China’s central bank had made clear on Tuesday it was ready to fight any downturn in the world’s second-largest economy as it warned of strong headwinds to growth and likely anaemic global demand. Also, decline in LME stocks acted as a positive factor. MCX copper prices are trading higher by around 0.6 percent at Rs.353.75/kg.
Brent crude held steady above $56 a barrel on Wednesday, and U.S. crude rose briefly more than $1, after a smaller-than expected rise in U.S. crude stocks was viewed by some as a sign that a supply glut was starting to abate. The gains in futures, however, were capped by a warning from the International Energy Agency (IEA) that ample global production would still swell world inventories before investment cuts begin to significantly dent output. . On the MCX, oil prices are trading lower by 1.39 percent at Rs.3123/bbl.
Gold prices will trade lower although Greece uncertainty bothers investors across the globe. Rise in interest rates in the US is a sure thing, and this will be one of the key factors determining the trajectory of gold prices.
Oil prices will trade lower as IEA has raised alarms on rise in global crude inventories exerting downside pressure on prices.
We expect Copper prices to trade lower today as traders will be reluctant to take on big positions given worries over Chinese demand growth, and as business slackens ahead of Lunar New Year.
Source: CommodityOnLine
