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Gold extends losses on weak overseas markets

Gold extends losses on weak overseas markets
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First Published: Thu, Nov 06 2008. 12 07 PM IST
Updated: Thu, Nov 06 2008. 12 07 PM IST
Mumbai: Indian gold futures extended losses on Thursday on weak global cues, where a strong dollar spurred selling, but a weak rupee may cap losses later in the day, analysts said.
“The lower opening can be attributed to continued strength in the dollar (against the euro),” said Harish Galipelli, head of research at Karvy Comtrade Ltd.
India imports most of its gold and pays for it in US dollars. Foreign gold extended a 2% drop in New York, erasing some of this week’s gains.
Gold has an inverse relation with the dollar as the two compete for funds.
The Indian rupee fell one percent on Thursday on worries foreigners would keep pulling funds out of falling stocks, but dollar sales by some foreign banks helped contain the losses.
There has been no fresh buying in the yellow metal, adding to the downward pressure, Galipelli added.
The benchmark December gold contract is supported at Rs11,470 levels, an analyst said. The contract declined 1.54% in the previous session.
December silver may trade in the range of Rs16,730-17,200 per kg.
Open interest for December gold on MCX was at Rs8,953, up from Rs8,616 lots a day earlier. Volume on Wednesday was 57.8 kgs.
Following are gold prices in rupees per 10 grams on the Multi Commodity Exchange of India Ltd. at 11:15 a.m.
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First Published: Thu, Nov 06 2008. 12 07 PM IST
More Topics: Gold | Silver | Markets | India | Karvy Comtrade Ltd |