Renewed conflict keeps prices high

MARKET REVIEW/ Domestic Review - Bullion

Gold continued its record rally in the international markets and surged on the back of a weak dollar and continued tension in west Asia, with fresh attacks in Iraq.

Internationally, gold on the New York Mercantile Exchange's Comex moved up by $4 to close at a new high $438.20 on Friday from $434.30 last week, replicating the levels seen 16 years ago.

The spot London gold fix closed too closed the week higher at $ 436.05 (PM) from last Friday's $431.

Analysts, however, predict that the prices are expected to correct by $15 in the next two weeks time.

In the local market, during the week ended November 13, prices were seen soaring, which put mild pressure on retail buying.

Spot gold (99.50 purity) in Mumbai closed higher on Thursday from last week's close of Rs 6460 at Rs 6470 per 10 gram.

Spot gold (99.90 purity) closed at Rs 6505 from last week's Rs 6500.

Silver, which has a higher demand from the industrial side also increased.

Spot silver (.999) crossed the Rs 12000 mark on Monday and closed sharply higher from last week's close of Rs 11865 to end at Rs 12005 per kilogram.

In futures trading, the prices saw an uptrend as well. On the National Commodity Derivatives Exchange (NCDEX), the November contract increased to Rs 6371 from Rs 6328, with open positions worth 805200 gram and a volume of contract of 54900 gram.

The December contract closed minorly lower at Rs 6345 compared with last week's close of Rs 6315, with an open interest and volume of 314900 gram and 32600 gram respectively.

The January contract closed at Rs 6340 from Rs 6315 with an open interest and volume of 72500 and 5400 each.

The December 7 contract of Sona (.995) traded at Rs 6335 a tad higher than Rs 6320 last week. The open interest was 22 with no trades.

The February 7 contract traded at Rs 6330 from Rs 6275 with an open interest of 10.

NCDEX silver's November contract closed at Rs 11245 from Rs 11274 last week, with an open interest of 84515 and a volume of 18810.

December contract closed at Rs 11186 compared with Rs 11246 last week. The open interest closed at 58515 kilogram while the volume of contract stood at 10845.

The January contract closed at Rs 11178 from Rs 11228, with an open interest of 16995 and a volume of 3195.

On the Multi Commodity Exchange of India (MCX) the December gold closed at Rs 6330 from Rs 6314 with an open interest of 4274 kg and a volume of 746 kg.

The February contract closed at Rs 6327 from Rs 6307 with an open interest of 204 kg, and a volume of 22 kg.

The December Gold HNI (High Net Worth Individuals) contract closed at Rs 6386 on Friday from last week's Rs 6275. The open interest stood at 21 kg.

HNI Silver closed at Rs 10885 from Rs 10756 last week, with an open interest of 7350 kg and a volume of 150 kg traded.

The December 3 silver contract dipped to close at Rs 11195 on Friday from Rs 11201 last week. The open positions stood at 166590 kg and the volume of contract was 59940 kg.

The March 2005 contract traded at Rs 11185 from Rs 11193 the previous week, with 19230 kg positions open, and a volume of 4050 kg.