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Gold prices in the domestic spot and futures market are likely to recover on Tuesday on low prices luring Chinese buyers and short-covering in the global market.
The yellow metal’s fall to a four-month low on Monday saw volumes on the Shanghai Gold Exchange rise to almost a two-week high.
Short-covering
On the other hand, buying to make up for the expiry of the December options and roll-over of positions to February contracts on the COMEX aided the uptrend.
But investors continue to be bearish elsewhere as holdings in SPDR Trust, the world’s biggest gold exchange-traded fund, dropped below 850 tonnes for the first time in four years. Holdings in the trust slipped to 848.91 tonnes on Monday.
Spot gold, gold futures
By mid-day in Asia, spot gold rose to $1,252.53 an ounce and gold contracts maturing for delivery in February to $1,252.20.
In the domestic market on Monday, gold for jewellery (99.5 per cent purity) fell to Rs 30,425 for 10 gm and pure gold (99.9 per cent purity) to Rs 30,575.
On MCX and NCDEX, gold could top Rs 30,000 for contracts expiring in December.
Brent crude
Speculation that crude oil stocks in the US dropped for the first time in two months is likely to drive Brent crude higher.
Brent crude for delivery in January was up at $110.89 a barrel and US crude for the same month at $94.32.
Soyabean, crude palm oil
Higher soyabean exports from the US are likely to help the oils and oilseeds market, though prospects of favourable weather for soyabean in South America could prove a dampener. Still, demand for soyameal could drive oils north.
Chicago Board of Trade soyabean contracts maturing for delivery in January were quoted at $13.26 a bushel in early Asian trade. Crude palm oil February contracts on Bursa Malaysia Derivatives Exchange opened lower at 2,623 ringgit or $815 a tonne.
The domestic market could be more influenced by rising arrivals of soyabean and groundnut.
Corn, wheat prices
Corn (industrial maize) and wheat prices could gain on rising exports, short-covering and weather concerns in the US.
CBOT wheat for delivery in March ruled at $6.59 a bushel and corn at $4.31 a bushel.
On NCDEX, higher corn production could be dampener while wheat may tend to look up with PEC floating another tender to export 70,000 tonnes.
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