Gold price rose marginally for the third straight session on Monday amid a heavy sell-off in global equity markets.
Precious metals rebounded marginally overseas. Gold in the international spot market was seen steady around $1940 an ounce, while silver prices in the same platform nearing to $27 an ounce.
Gold and silver prices gained as the dollar slipped from one week high on the back of weak US job data, raising fears of slower global economic recovery from COVID-19 pandemic. Investors were bullish on the safe-haven asset as number of coronavirus cases rose in the United States and some other countries, re-imposing anti-disease controls that disrupt businesses.
On the Multi-Commodity Exchange, gold traded a tad higher tracking international commodity markets. Gold October Futures gained Rs 68 at Rs 50,746, after hitting an intraday high of Rs 50,823 against the previous close of Rs 50,678 per 10 gm. MCX gold futures currently trade over Rs 5,300 lower than the lifetime high of Rs 56,191 per 10 gm, hit on August 7. On MCX, the yellow metal has risen 41.5% to life-time high since the beginning of the year.
Silver September Futures, gained by Rs 851 to Rs 68,117 per kg today after they touched an intraday high of Rs 68,398 per kg. Silver Futures hit a lifetime high of Rs 77,949 on August 7.
In the international spot market, gold and silver continued positive momentum, despite rising dollar. Spot gold was up 0.2% at $1,935.53 per ounce falling to its ine week low of $1,916 on Friday. Comex gold was trading near day's high at $1,931 per ounce, rising 0.40%, while US gold futures gained 0.4% to $1,941.10. Silver gained 0.2% to $26.84 per ounce.
A weak momentum in the equity market also helped the bullion recover from its recent fall this week. Domestic as well as international equity markets were trading majorly lower today, amid weak stance by investors due to heightened tensions of slower recovery from virus pandemic. Asian stock markets were mixed on Monday, tracking losses in Wall Street that registered its biggest weekly decline in more than two months on Friday. Benchmarks in Shanghai, Tokyo and Hong Kong retreated while Seoul and Sydney gained.
Traders said investors rushed to the safe-haven asset amid weakness in equity markets due to the rising cases of coronavirus, on a global scale. Worldwide, there were 272 lakh confirmed cases and 8.87 lakh deaths from COVID-19 outbreak. Meanwhile, India's death toll from COVID-19 infections rose to 71,687 and total coronavirus cases to 42.04 lakh as of Monday.
In India, 24-carat bullion per 10 gram in the national capital traded at Rs 54,130. Price of 24-carat gold stood at Rs 53,330 per 10 gram in Chennai. In Mumbai and Kolkata, the rate for 24-Carat gold stood at Rs 50,520 and 53,920, respectively.
On gold's outlook, Hareesh V, Head of Commodity Research at Geojit Financial Services said," A steady U.S dollar and optimism that the deadly pandemic may be under control soon continue to hit the safe-haven appeal of gold. However, hopes of more fiscal stimulus measures and elevating U.S-China trade tensions would offer firm support to prices."
Anuj Gupta, DVP- Commodities and Currencies Research, Angel Broking, "Last week, gold prices corrected by 1.50% and closed at Rs 50,678 levels. Silver prices also corrected sharply by 2.28% and closed at 67,226 levels. In international market Spot, gold is trading at $1935 per ounce and silver is trading at $26.99 per ounce levels. Losses for the yellow metal were limited as US Federal Reserve's officials signalled towards a prolonged lower interest environment and more stimulus measures in the coming months to help the economy get back on track."
On Silver futures, Geojit Financial Services in its daily note said, "Support of $26 likely to hold the downside and it may inch prices higher initially. However, a close above $28 is needed to trigger major rallies in the counter. A direct drop below $26 is a signal of liquidation. MCX Silver Nov futures' resistance is placed at Rs 70820 and support at Rs 64300.
On Gold, the agency said, "Breaking the immediate support of $1920 is required to continue selloffs in the counter. Else, may see recovery upticks for the day. However, a direct rise above $1974 is a signal of a bullish outlook." As per the agency, Gold futures resistance is placed at 51,850 and support at 50520.