Extending gains for the third consecutive day, gold prices further gained momentum on Wednesday, tracking the overseas trend, amid rising worries over coronavirus outbreak.
The yellow metal that was already gaining on the back of support from international spot gold today, later added further momentum after 15 new cases were reported, taking the total number of COVID-19 cases to 28 in the country.
Internationally, spot gold extended gains after the US Federal Reserve slashed its benchmark interest rate by 50 bps. Spot gold climbed 0.3% to $1,643.76 per ounce, although it later traded 0.13% higher at $ 1,644.30 per ounce. US gold futures gained 0.1% to $1,645.30.
Following the reports of fresh cases of the virus reported today, Gold Futures on MCX rose 250 points or 0.57% higher to Rs 43,722 as compared to the opening price of Rs 43,474 per 10 gram. It made a high of Rs 43,730 and low of Rs 43,293. Yesterday gold futures on MCX rose by Rs 1,518 from earlier Rs 41,856 to Rs 43,474 per 10 gm.
The impact of the deadly coronavirus outbreak has been substantial on the global markets in recent weeks. On a similar trend, MCX Silver April futures were trading Rs 431 or 0.93% higher at Rs 46,833 per kg.
In the retail market, gold price for 24 karats in Delhi, gained ground on geopolitical tensions and spiked to a record Rs 43,500 per 10 gm from Rs 43,400 per 10 gm recorded yesterday.
Commenting on gold's trend, Hareesh V, Head of Commodity, at Geojit Financial Services said,"Gold may edge higher further as investors seek safety in gold amid concerns over the global economic slowdown. As coronavirus is now spreading faster outside China and US Fed's emergency rate cut roiled financial markets, the demand for safe assets like gold will increase."
Speaking on spot gold's technical outlook, he further added," As long as prices stay above $1,560 expect buying momentum will continue. Stiff resistance is seen at $1660 followed by $1700. A close below $1545 is required to negate the bullish outlook and take prices lower."