Gold in the spot and futures markets is likely to rule firm on Friday as concern over Eurozone crisis will keep haven demand for the yellow metal in tact. The market, at least, will look for signals from the economy before it decides on whether it should continue to pare gold holdings.
This week, the financial crisis in Cyprus plus the German factory data have triggered fears that the euro crisis is far from being over. Besides, any strengthening of the dollar will boost the yellow metal as its rise against the Indian currency will make commodities such as gold, crude oil and vegetable oils costlier.
In early Asian trade, gold ruled firm at $1,614.54 an ounce in spot trade, while gold futures for delivery next month quoted at $1,613.50.
In the domestic market on Thursday, gold for jewellery (99.5% purity) dropped to Rs 29,680 for 10 gm and pure gold (99.9% purity) to Rs 29,820.
The oils and oilseeds complex is likely to head lower as a bearish trend in corn (industrial maize) dragged soyabean on the Chicago Board of Trade. China’s lower inventories and problems in Brazil shipments are still holding the counter up.
Soyabean, crude palm oil
CBOT soyabean dropped to $14.41 a bushel, while on Bursa Malaysia Derivatives Exchange crude palm oil for June delivery quoted a 2,455 ringgit ($787.50) a tonne.
With the US farmers getting ready to plant corn, the market expects plantings to be the highest in the last eight decades or so. The counter is getting support only due to supply tightness but that is set to vanish soon. Wheat is also seen bearish on prospects of higher global production and low export demand in the US.
CBOT wheat May contracts ruled at $7.28 a bushel, while corn contracts for the same month were $7.28 a bushel.
Crude oil basket
The bearish data from Germany and signals of economic trouble are also dragging crude oil. So much so, the premium that Brent crude enjoys over West Texas Intermediate or NYMEX crude has begun to shrink.
Brent May contracts quoted lower at $107.36 a barrel and NYMEX crude at $92.58.
Natural rubber is also seen heading south in view of the crisis and fall in crude oil prices.