Gold, silver scale new peaks, but Sensex loses sheen on profit-booking
The festival of lights has come and gone, but each day seems to be celebration time for precious metals in the country.business Updated: Nov 08, 2010 21:31 IST
The festival of lights has come and gone, but each day seems to be celebration time for precious metals in the country.
Gold bullion price rose by R235 in Delhi to close at a new all-time high of R20,335 per ten grams on Monday.
Silver, which has been on a record breaking spree in the last few days, also shot up by R1,000 to within kissing distance of R40,000 per kg. Silver price in Delhi was Rs 39,900 per kg on Monday.
However, the Bombay Stock Exchange benchmark Sensex saw some profit booking after it closed at its all-time high of 21,004.9 on Friday. The Sensex lost 152 points to close at 20,852.4 on Monday.
Experts say that the demand for physical gold is high in India and also some other countries like China.
“It is clearly the physical demand for gold and silver that are taking the prices up,” said Ritesh Jain, head of fixed income at Canara Robeco Mutual Fund. “The rural demand is high as money has shifted to rural India as a result of good crops.”
While the biggest gold and silver buying festival Diwali has just gone by, the Hindu marriage season is round the corner and the market is expecting the price of precious metals to remain firm on the back of the demand for the marriage season.
“There could be some shallow correction in the prices of gold but we believe Gold will cross R22,000 per ten gram mark sometime next year,” said Jain.
The demand for gold and silver has risen sharply over the past one year. Market experts says that while gold import (in value terms) has risen by around 80% in the first nine months of 2010, the import for silver (in value terms) in the first six months of 2010 has risen over six-fold.