Bullion counter is expected to remain downbeat in MCX tracking sharp fall witnessed yesterday in international markets amid bounce back in greenback and concerns over further rate hikes by the Federal Reserve.
Bullion counter is expected to remain downbeat in MCX tracking sharp fall witnessed yesterday in international markets amid bounce back in greenback and concerns over further rate hikes by the Federal Reserve. Gold can test 51800 taking resistance near 52200 in domestic markets. While silver can test 57500 in MCX. Benchmark U.S. 10-year Treasury yields fell for a third session to 2.7788%, decreasing the opportunity cost of holding non-interest-bearing gold. Data on Monday showed U.S. single-family homebuilders’ confidence and New York state factory activity fell in August to their lowest levels since near the start of the COVID-19 pandemic.
Base metals may trade in red as weak economic data from China continue to keep prices under pressure. Copper can dip lower towards 660 in domestic market. Chinese industrial output grew 3.8% in July, which was below expectations of 4.6%, and also lower than June’s reading of 3.9%. The data comes on the heels of several COVID-19 lockdowns across the country, which has severely crimped economic growth this year. Chinese retail sales also read weaker than expected. Concerns over the economy were further exacerbated by an unexpected interest rate cut by the People’s Bank of China, pointing to extreme pressure on the central bank to support economic growth. Zinc may remain on weaker path as it can test 315 in MCX.
Crude oil can tad further lower as weaker economic data from top crude buyer China renewed fears of a global recession. Meanwhile Investors also watched talks to revive the 2015 Iran nuclear deal. More oil could enter the market if Iran and the United States accept an offer from the European Union, which would remove sanctions on Iranian oil exports. The premium for front-month WTI futures over barrels loading in six months stood at $3.46 a barrel on Tuesday, the lowest level in four months, suggesting easing tightness in prompt supplies. Natural gas prices can continue its bounce back as it can test 715 in MCX.
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