Both the precious metals nose-dived on the Mumbai bullion market last week.
Gold dipped below four and quarter year lows mainly due to off season slack demand coupled with nervous unloading induced by weakness abroad.
Even silver was down in overseas markets which was reflected here. Informed sources said silver supplies had been heavy in Delhi and gold in the south, while the demand was at a low ebb.
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Silver was down below 6,500 mark and gold below 4,400 mark.
Both the precious metals have been declining from the March 1 high levels of Rs 4,990 for gold and gold biscuits at Rs 58,300. Silver .999 finess on the day was demanded at the high of Rs 7690. The sentiment overseas had been one of nervous offerings on apprehension of likely sale of gold by the central banks of Europe. At the same time with strong $ investors showed little interest in gold and turned to bonds and $ investment.
Gold on the London Exchange declined to the low of $ 333.45 per troy ounce. At the same time silver too, suffered a setback and was down at $ 4.64 per ounce.
Despite the fact that the prices of both the precious metals were undervalued and heavy short position had been reported, even reactionary rise would have been short-lived and the bearish trend would continue according traders here.
This initiated offerings and at the same time buyers refrained themselves from entering the market despite low levels. At the same time off season demand was poor.
Analysts were talking of the gold price declining to $ 325 per ounce.
Consequently buyers here were passing time till the Dessara festival when the demand would start. Stockists had been incurring losses due to dearth of buyers as marriage season demand was over.
Standard mint gold commenced last week at Rs 4,550, a previous close and started dropping to the low of Rs 4350 to end at the same level. Gold 22 carat fluctuated between Rs 4210 and Rs 4020. Gold official biscuits lost Rs 2300 over the week. Ready silver .999 fineness was Rs 6705 , Rs 5 higher than their previous close and drifted to close at the low of Rs 6469 per kg. Tenderable silver over the week lost Rs 240 at Rs 6465 per kg.
Oilseeds: Castorseeds futures recovered on the Mumbai oilseeds market last week. However, activity was still below normal and on higher advices from Ahmedabad bear covering helped recovery. According to chartists the Rs 1,135 level had to be crossed, at the close, for bullish signal. With the favourable monsoon and limited export demand on castor oil export front operators were unwilling to go along while exporters and spot-houses were hedging against the stocks in futures as a safeguard against fall in spot prices.
In edible oils, on good retail demand along with limited supplies, groundnut oil hardened from Rs 348 on Tuesday to Rs 356. Palmoleine was also in good demand and prices recovered in Malysia
Prices moved up from the recent low of Rs 268 to 259 to end at Rs 263 per 10 kg. In view of good rainfall the outlook for groundnut crop in Saurashtra looks bright
Grains: A mixed trend prevailed in the grain market last week with the prices ruling steady for cereals and coarse grains as the demand was low.
There was paucity of funds in view of the delay in returnings of outstanding funds from upcountry centres resulting in shrinking turnovers. Upcountry centres too, were hard hit financially due to steep fall in pulses. Sellers were keen on unloading stocks but buyers were hard to find. Wheat ruled in thin trading activity . The supplies were limited as the demand here was poor and the prices out of parity to some extent The Food Corporation of India had stooped procurement of wheat in Punjab as well as in Madhya Pradesh.
Consequently, prices have dropped and in Punjab, inferior wheat was offered at round Rs 475 for moist inferior varieties which was priced here steady at Rs 525-575 per quintal.
Among pulses gram ruled steady at Rs 1225-1300, gram dal at Rs 1500-1700 and Kabli gram at Rs 1,250-1350. Moog ruled at Rs 1,400-1,700 but moog dal was quiet at Rs 1,300-1,600.
In urud, importers had formed a syndicate and fixed prices of imported urud at Rs 1,000, against the previous weeks level of Rs 850-875.
Urud dal fetched Rs 1,300-1,600. Peas green was steady at Rs 1,375-1,440, white at Rs 1,100 Tur old was offered at Rs 950-975 and new at Rs 1,025-1050. Tur dal was easy at Rs 1,800-2,100 per quintal.