Gold prices in the domestic spot and futures market are likely to look up a little on Wednesday, taking cues from overnight gains in the global market.

With Asian and other global markets shut for the New Year, the volume of trading is expected to be low. This could magnify the movements, either way, and therefore, it would be better to stay on the sidelines.

Second-worst performer

Gold was the second-worst performer among metals last year. It had also registered its first annual loss in 13 years in 2013.

Prospects for this year, too, seem bleak with investors looking at other commodities for gains.

US stimulus taper

Problems for gold are unwinding of the US stimulus programme from this month and hopes of rebound in equities market, which could attract investors.

Gold’s hopes of holding on to gains are higher inflation and geo-political tensions when investors could look to it as a haven instrument.

Way back in July 2013 analysts had projected worse things for gold this year.

Holdings in SPDR Trust

To add to investors’ worry is the data from SPDR Trust, world’s biggest gold exchange-traded fund, showing gold holdings have dropped below 800 tonnes to 798.22.

The number of speculators who have bet that gold will fall is also large.

Spot gold, gold futures

Spot gold ruled at $1,198.51 an ounce and gold futures for February delivery at $1,202.30. On NCDEX, spot gold ended at Rs 29,140 for 10 gm.

Gold futures for delivery in February are likely to trade between Rs 28,000 and Rs 28,500 on MCX and NCDEX.

Range-bound trading

Crude oil is likely to rule range-bound awaiting US data on stockpiles. Higher supply from Libya is capping Brent gains. Brent crude for February delivery slid to $110.80 a barrel and US crude to $98.42.

Oils and oilseeds market may come under pressure on outlook for the weather in South America being conducive. Soyabean crop in Argentina and Brazil is seen gaining from the weather.

Soyabean, crude palm oil

On Chicago Board of Trade, soyabean for delivery in March dropped to $12.92 a bushel. Crude palm oil on Bursa Malaysia Derivatives Index for delivery in March opened higher at 2,660 ringgit or $812 a tonne.

Corn (industrial maize) and wheat could look up a little on short-covering, though the long-term prospects are bearish.

CBOT wheat for delivery in March ruled at $6.05 a bushel and corn for delivery the same month at $4.22 a bushel.