8/05/2011 05:16:00 PM
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Bullion Updates
Precious Metals resorted to profit booking yesterday after surging in the early session of the trade amid growing uncertainties regarding the global economic recovery. COMEX Gold Aug futures made a record high of $1,681.7 per troy ounce yesterday before closing down to $1,656.2 per troy ounce, a 0.43 percent decline from $1.663.4 per troy ounce made on 3rd Aug, 2011.
A panic selling in the equity markets and a stronger greenback led investor’s park funds in the government bonds yesterday. Investment demand for the yellow metal at the SPDR Gold ETF remained unchanged yesterday. Markets now eye the U.S. Nonfarm Payroll data and the U.S. unemployment rate schedule to release in the evening session of the trade.
Strategy for Bullion
Spot silver prices slipped almost 7 percent on Thursday and touched an intra-day low of $38.44/oz. The white metal took cues from a stronger dolla rcoupled with downside in the base metals. We expect gold to trade with a sideways bias as it will take mixed cues from dollar strength and rise in risk aversion in the global financial markets due to global economic tensions. Silver being an industrial metal will also take cues from base metals.
Base Metal Updates
Crude Oil Trend
NYMEX Crude oil Sept futures were battered on concerns of subdued demand as the Global Economy is showing signs of stalling while another report showed a weak improvement in the U.S. Labor market also aggravated the concern that demand would wane from the world’s largest crude oil consumer.We expect crude oil prices to trade lower today as rising worries over global economic recovery would lead to demand concerns.Additionally, a stronger dollar will also exert further pressure. Futures slid by a sharp 5.77 percent to close at $86.63 per barrel yesterday from $91.93 per barrel made on 3rd Aug, 2011.
Copper Trend
Copper declined sharply by more than 2 percent in yesterday’s trading session as demand concerns from the US, the world’s largest economy coupled with global economic tensions exerted pressure on prices. Additionally,a weaker dollar led further downside. It touched an intraday low of $9331/tonne and ended at $9344/tonne. COMEX Copper Sept futures declined by 2.09 percent to close at $4.2355 per pound yesterday from $4.3260 per pound on 3rd Aug, 2011 while Copper LME three month futures also scaled down by 2.15 percent to close at $9,344 per ton from $9,549 per ton made on 3rd Aug, 2011.
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