Gold prices in the domestic spot and futures market are likely to rule below Rs 30,000 for 10 gm on bearish cues from the global market.
Overnight, prices in the global market ruled lower as the dollar rose against a basket of currencies.
Data from US’ ADP Research Institute showed that jobs in the private sector increased last month more that what analysts anticipated, an indication that the economy is on the path of revival.
Minutes of Fed meet
Minutes of the US Federal Reserve meeting were also released showing that most members were for pruning the $85-billion-a-month stimulus package, though cautiously.
The market has reached a situation where investors seem to be looking for reasons to exit rather than enter. Physical buying in Asia remains strong, though.
Further clues should be available from the US non-farm payroll data due later in the day.
Gold holdings in SPDR Trust
Investors continue to cash out of gold exchange-traded funds. SPDR Trust, world’s biggest, said that its gold holdings fell further to 793.12 tonnes.
In India, the currency market could have a say on the extent of bullion movement. Any weakening of the rupee against the dollar makes import of gold, crude oil and vegetable oils costlier.
Spot gold, gold futures
In early Asian trade, spot gold ruled at $1,226.64 an ounce and gold for delivery in February at $1,225.60.
On NCDEX, spot gold closed lower at Rs 29,400 for 10 gm on Wednesday.
MCX and NCDEX gold February contracts will continue to rule below Rs 29,000.
Demand seen lower for crude oil
A rise in US stockpiles and easing of geo-political tensions could put pressure on crude oil. Demand is also seen lower despite cold snap sweeping the US.
Brent crude for delivery in February ruled at $107.49 a barrel and US crude at $92.65.
Oils and oilseeds market are set to head south as China has begun to ease its scrutiny of distiller’s grain, derived after corn is crushed for ethanol, for genetically modified corn. This could compete with soyameal.
Besides, weather concerns over Argentina soyabean crop are also easing.
Soyabean, crude palm oil
On Chicago Board of Trade (CBOT), soyabean for delivery in March was quoted at $12.73. Crude palm oil on Bursa Malaysia Derivatives Exchange for delivery in March dropped to 2,539 ringgit or $775 a tonne.
Wheat, corn futures
Fears of oversupply are likely to drag wheat and corn (industrial maize). Ethanol inventories are higher and hedge funds are still bearish on corn. Wheat is facing pressure from reports of higher production in the Black Sea region.
CBOT wheat for delivery in March fell to $5.89 a bushel and corn for delivery the same month to $4.16 a bushel.