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Friday, July 17, 2009

Precious metals end mixed

Silver rises but gold witnesses marginal drop

Precious metal prices ended mixed on Thursday, 16 July, 2009. Gold prices ended their three day winning streak and ended moderately lower. However, silver managed to gain for the day.

Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa.

On Thursday, gold for August delivery ended at $935.4, lower by $4 (0.4%) an ounce on the New York Mercantile Exchange. Before today, gold had risen by 3% in the past three sessions. Last week, gold ended lower by 1.6%. Year to date, gold prices are higher by 5.9%.

For the month of June, 2009, gold ended down by 5.4%. Gold had ended the month of May higher by 9.8%. It was the highest monthly gain registered by gold in six months. For the second quarter, gold ended higher by 0.5%. The metal had gained 4.3% in the first quarter of this year.

On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped somewhat (11%) since then.

On Thursday, Comex silver futures for September delivery rose 4.1 cents (0.2%) at $13.235 an ounce.

Silver ended 13% down for the month of June, 2009. For the month of May, silver gained 26.6%. It was the biggest monthly gain for silver in more than two decades. For second quarter, silver rose 4.5%. Year to date, silver has climbed 17.3% this year. For 2008, silver had lost 24%.

The Philadelphia Fed's manufacturing index in US slipped to negative 7.5 in July from negative 2.2 in June. Though market was expecting a slide, the drop was more than expected. Readings below zero in the Philly Fed diffusion index indicate contraction in activity. The index measures the breadth of economic activity across firms.

In 2008, gold prices ended higher by 5.5%. The dollar index had gained 12% that year.

At the MCX, gold prices for August delivery closed lower by Rs 53 (0.35%) at Rs 14,717 per 10 grams. Prices rose to a high of Rs 14,816 per 10 grams and fell to a low of Rs 14,694 per 10 grams during the day's trading.

At the MCX, silver prices for September delivery closed Rs 37 (0.17%) lower at Rs 21,821/Kg. Prices opened at Rs 21,830/kg and fell to a low of Rs 21,727/Kg during the day's trading.

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