Financial Daily from THE HINDU group of publications
Tuesday, Jul 09, 2002
Financial Daily from THE HINDU group of publications Tuesday, Jul 09, 2002 |
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Agri-Biz & Commodities
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Precious Metals Gold dips on investor fatigue G. Chandrashekhar
MUMBAI, July 8 LAST week, the gold market managed to overcome the nervousness that followed the sudden and sharp fall in prices at the end of Comex trading and moved in a narrow range oscillating between $ 311 and 314 an ounce marked by quiet trading. Silver found the return of fund interest. The yellow metal did react to forex and equity market conditions, but public holidays in the US limited trading activity. The official price on Friday was $ 311.30/oz (London PM fix), down 2.3 per cent week-on-week. ] The last Comex Commitment of Traders report showed that the net long position in gold had fallen again by 10.2 tonnes to 118.1 tonnes as at Tuesday, June 25, largely due to an increase in short positions. The second-successive weekly fall in the net long positions despite the weakness in the dollar and equity markets is further confirmation of some investor fatigue, said Mr Kamal Naqvi, analyst with Macquarie Research quities adding that quarter- and half-year end played a large part in profit taking. While weaker-than-expected new jobs data in the US provided support, some weakness could be seen week beginning July 8 following an anticipated bounce-back in equity markets, in what will be an important test of support. "But we remain positive on gold given our concerns about further losses in equity markets in coming weeks,'' Mr Naqvi observed. Silver managed to rise more significantly last Monday on fund buying and short-covering, with the return of investor interest and prices traded towards $ 5.00/oz with the recent sell-off from stale longs and a firmer gold prices being supportive. However, the metal softened over the rest of the week with softer gold and base prices having a negative impact. The official price on Friday was $4.91/oz (London AM fix), a gain of 0.8 per cent week-on-week. Platinum came under pressure last week, firstly from Japanese selling and then selling from largely US-based investors, with concerns about the recovery following weak equity markets, much like the base metals. It lost 4.6 per cent in value to end the week at $ 520/oz. Palladium managed to hold its modest levels and closed unchanged at $ 321/oz.
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