Gold futures are likely headed lower on Tuesday as the yellow metal seems to be losing its appeal as a safe investment tool.
On Monday night, George Soros, the billionaire investor who has had significant holding in the precious metal, said gold had lost its appeal after the eurozone crisis. To lend weight to his comments, holdings in gold exchange-trade funds have been dropping.
Last month, investors cashed out $9.2 billion in gold.
In early Asian trade, gold was quoted lower at $1,574.84 an ounce, while gold futures maturing in June quoted at $1,570.40.
In the domestic market on Monday, gold for jewellery (99.5% purity) fell to Rs 29,400 for 10 gm, while pure gold (99.9% purity) was down at Rs 29,550.
Currency movements could also dictate gold’s fall as any rise in the dollar against the Indian rupee could make imports such as gold, crude oil and vegetable oil costlier.
Brent, NYMEX crude
Crude oil is likely to come under pressure as analysts said that stockpiles in the US probably gained.
Still, in early trade Brent May contracts were up at $104.69 a barrel, while West Texas Intermediate (NYMEX) quoted at $93.43 a barrel.
Soyabean, crude palm oil
The oils and oilseeds complex is likely to rise in sympathy with the grains complex where Chinese imports and fears of winter crop damaged pulled up prices higher.
On Chicago Board of Trade (CBOT), soyabean for delivery in May rose to $13.80 a bushel, while crude palm oil on Bursa Malaysia Derivatives Exchange for June delivery was up at 2,400 ringgit ($785) a tonne.
Corn, wheat prices
Confirmation that China has bought nearly a million tonnes of wheat turned the grains market bullish. In addition fears of damage to the winter wheat crop besides the likelihood of frost affecting it further held up the counter.
On CBOT, wheat May contracts were up at $7.10/bushel, while corn contracts for the same months rose to $6.37a bushel.