Gold prices in the spot and futures markets are likely to decline on Tuesday as investors attempt to book profits. This is because they now find the equity markets attractive.
Proof of investors getting out of gold is borne by holdings in the yellow metal’s biggest fund, SPDR, at 1,062.30 tonnes, the lowest in 3-1/2 years.
In early Asian trade, spot gold fell to $1,466.50 an ounce, while gold futures for June delivery slipped to $1,465.70.
In the domestic market on Monday, gold for jewellery (99.5 per cent purity) rose to Rs 27,365 for 10 gm, while pure gold (99.9 per cent purity) increased to Rs 27,495.
On the Multi Commodity Exchange, June futures are likely to rule below Rs 26,900, while August futures may drop towards Rs 27,250.
Crude oil will likely drop on speculation that US data could show stockpiles at over eight-decade higher. Brent oil June futures declined to $105.15 a barrel, while West Texas Intermediate (NYMEX) slid to $95.74.
The oils and oilseeds complex is likely to see some recovery on Brazil infrastructure woes to cash in on soyabean supply shortage. Lower soyabean stocks in the US will aid the trend, but the after-effects of bird flu incidents in China will cap the gains.
Chicago Board of Trade (CBOT) soyabean was up at $13.76 a bushel in early Asian trade, while on Bursa Malaysia Derivatives Exchange crude palm oil for July contract was down marginally at 2,244 ringgit ($755) a tonne.
The damage to US wheat winter crop due to freeze in April is seen as affecting supply. This could result in wheat prices gaining. On CBOT, wheat for delivery in July was up at $7.06 a bushel.
Corn (industrial maize) is also likely to gain as its planting is the slowest in almost three decades going by the US Department of Agriculture data. In early Asian trade, June contracts were up at $6.38 a bushel.