Gold melts on Re heat

Price Slips To Rs 14,305 From All-Time High Of Rs 15,705

WITH the equity market stealing the glitter, gold gave up its entire overnight gains in domestic markets on Thursday, eroding metal's appeal as an alternative mode of investment. Appreciation of rupee against the US dollar also dented gold's strength to some extent, dealers said.
    The fall was the steepest in Delhi market, where the price of standard gold plunged by Rs 350 as the metal settled lower at Rs 14,385 per 10 gm. While in Kolkata the precious metal was cheaper by Rs 145 at Rs 14,570 per 10 gm, it traded Rs 140 lower at Rs 14,375 per 10 gm in Chennai. In Mumbai, standard and pure gold dropped Rs 116 and Rs 115 to Rs 14,305 and Rs 14,370 per 10 gm, respectively.
    However, the fall wasn't attractive enough to bring in buyers to stores. In fact, source said, customers continued to encash their old ornaments. According to traders buying could start if the prices fall by another Rs 1,000 a gm. "If prices fall below Rs 13,000 per 10 gm in domestic markets physical buying may gain momentum," said Prakash Jain, a leading bullion merchant in south Mumbai's Zaveri Bazar.
    Meanwhile, bullion dealers started importing in small quantities after a gap of nearly two months, sources said. Dealers expect a revival of demand for gold jewelleries during weddings season which will begin later this month.
    With Thursday's fall, gold has become cheaper by nearly Rs 1,400 per 10 gm, down nearly 9% from its life-time high of Rs 15,705 touched on February 21 this year.
    In international markets, US gold for April delivery eased by $7.80 an ounce at $876.90 as stock markets extended gains in Europe and stock futures in the US moved up after Wells Fargo said it expected better first quarter earnings. In London, spot gold fell to $887.20/878.55 an ounce from Wednesday's New York close of $879.55.
    Silver also recorded a hefty fall on Thursday in the absence of any trigger. Delhi markets saw the biggest fall, where ready silver (.999) plummeted by Rs 230 to Rs 20,700 per kg. While in Kolkata, the white metal lost Rs 100 to Rs 21,100 per kg, the spot silver recorded a loss of 65 at Rs 21,470 per kg in Chennai. Mumbai markets recorded a marginal loss of Rs 20 to Rs 21,125 per kg.
    indra.bhadra@timesgroup.com