Mumbai: Gold futures opened higher on the Multi Commodity Exchange of India Ltd (MCX) on 22 July on speculative buying amid lingering uncertainties over the U.S. financial system.
Analysts said the trend was likely to persist during the day.
“The market is recovering from last week’s sharp declines,” said Harish Galipelli, head of research at Karvy Comtrade Ltd. “Short covering is fuelling gold’s rise.”
Overseas gold that guides the local market, rose with fears that the credit market crisis may see more write-downs in the U.S. Gold’s attractiveness as an alternative investment gets heightened during times of uncertainties.
The August contract for gold traded at Rs 13.363at 11.30 am while the October Contract stood at Rs13.453.
The benchmark August gold on the MCX was seen aiming for Rs13,500 per 10 grams with a support at Rs13,200 , said an analyst at Anand Rathi Commodities.
Open interest for August gold was at 8,630 lots, down from 8,724 lots on 21 July. Volume the previous day was at 48.36 kg.
September silver was expected to follow gold and was seen aiming at Rs26,000 per kg, said an analyst at Motilal Oswal Commodities Broker Pvt Ltd. The contract traded at Rs25,858.