Gold prices in the domestic spot and futures market are likely to rule flat with the global market caught in a holiday mood for Christmas and the New Year.
However, prices may trade with an upper bias until the US markets open later in the day. Some physical buying is seen in Asia with investors, particularly Chinese, seeing value at current prices.
However, going forward the scenario is not rosy for gold with all economic indicators pointing to growth which could mean that investors will be now looking for other assets to raise their income. The growth also ends fears that investments in other assets, particularly stocks, may not be beneficial.
Fed stimulus taper
The US Federal Reserve’s move to begin paring its $85 billion-a-month stimulus programme from next month is also a drag on the yellow metal.
In early Asian trade, spot gold rose marginally to $1206.08 an ounce and gold futures maturing for delivery in February to $1,205.30.
In the domestic market on Tuesday, NCDEX spot gold closed at Rs 29,410 for 10 gm. In the domestic futures market, MCX and NCDEX contracts for February delivery could range between Rs 28,000 and Rs 28,500.
Crude oil
Crude oil will head north on the back of strong indications of economic growth which would lead to higher demand.
Brent crude contracts for delivery in February rose to $112.10 a barrel and US crude for the same month to $99.49.
Oils & oilseeds
The oils and oilseeds market is likely to gain on reports of US selling over three lakh tonnes of beans to Egypt and unknown destinations. While Egypt has bought 1.14 lakh tonnes, some 1.85 lakh tonnes have been sold to unknown buyers.
Rains in Brazil and forecast of favourable weather in Argentina could be factors that could hold the complex on leash.
Chicago Board of Trade soyabean futures maturing for delivery in March were up at $13.22 in early Asian trade. Crude palm oil on Bursa Malaysia Derivatives Exchange opened lower at 2,618 ringgit or $794.50 a tonne for March futures.
Corn, wheat
China’s statement that corn shipments from the US are continuing could prevent corn (industrial maize) from falling. But comments such as from Egypt of ample stocks in silos could drag wheat.
CBOT corn contracts for delivery in March was up at $4.34 a bushel but wheat was down at $6.06 a bushel.