The market mood across the world continue to remain distorted over worries on Greek's political crisis and flagging economic growth.
It presented a strange picture in India where both the value of the rupee and that of gold plunged. Normally, whenever the rupee falls, there is increased safe haven buying in gold, propping up the price of the yellow metal. Analysts said that the markets remain stressed.
Owing to the political unrest in Greece, spot gold extended its weakness from the previous session by sliding more than one per cent to a four-month low of $1,585 an ounce.
The fall in the 17-nation euro currency to its three-month low of less than $1.30 a dollar added to the pressure on gold. However, at MCX, weakness in the rupee to a degree limited the losses on gold, a report from Geojit Comtrade said. There was some amount of recovery at the India gold futures markets in late evening trades.
Base metals
Amidst fears of slower global economic growth there was lower demand for metals. Base metals complex in London Metal Exchange (LME) continue to trade negatively owing to resurfaced euro-zone tensions. Fears that Greece would have to exit the Euro zone after the yield on Spanish 10-year bond rose to 6 per cent added to the uncertainty in the markets.
Crude oil
Bad tidings from the Euro zone and fears that slower-than-anticipated global economic growth would affect crude oil demand, also weighed on the market. Crude oil prices continue to remain under pressure hovering near key support level of $95.30 a barrel. Earlier on Wednesday, the API crude inventory report showed a build-up in stockpiles further pressurizing prices. Some amount of recovery was witnessed at the crude futures counter in India in late evening trades.
The dollar extended its longest string of daily gains since 2008, as investors took safe haven shelter in the midst of Euro region tensions.
The Indian rupee pared some of the gains it made during the last couple of days. The fall in the rupee is also making the Indian commodity markets jittery.