European markets traded higher today on rising expectations of some solution towards debt laden Greece which led to rise in risk appetite in the global markets. Additionally, favorable economic data from the US also acted as a positive factor.
Spot gold prices rose around 0.3 percent today on account of a dollar weakness, as a weaker dollar makes dollar-denominated commodities look cheaper for the holders of the other currencies. Additionally, rise in crude oil prices also boosted inflation-led demand for gold.
The yellow metal touched an intra-day high of $1734/oz and was trading at $1732/oz till 4.30 pm IST today. On the MCX, Gold April contract rose around 0.2 percent as further gains were capped due to a stronger Rupee.
Taking cues from rise in gold prices coupled with a weaker dollar, spot silver prices also trade higher by around 0.2 percent today.
The white metal touched an intra-day high of $33.65/oz and was hovering around $33.52/oz till 4.30 pm IST today. MCX Silver March contract rose around 0.2 percent and touched an intra-day high of Rs56,499/kg till 4.30 pm IST today.
Copper prices came under pressure today mainly taking cues from sharp rise in the metal Shanghai inventories. Weekly copper inventories in warehouses monitored by the Shanghai Futures Exchange increased sharply by almost 10 percent to 217,142 tonnes this week. However, weakness in the US dollar cushioned sharp decline in prices.
Increasing concerns over potential supply disruptions from Iran and optimism over Greece bailout helped Nymex crude oil prices to trade higher by 0.4 percent today. Prices touched an intra-day high of $102.95/bbl and were hovering around $102.74/bbl till 4.30 pm IST today.
MCX crude oil February contract traded lower by 0.1 percent today due to appreciation in the Indian Rupee and touched an intra-day low of Rs5043/bbl and was trading at Rs5055/bbl till 4.30 pm IST today.
Outlook
On rising expectations that Greece’s government is nearing an agreement in order to secure a bailout package to avoid a debt default, we expect risk sentiments in the global markets to be upbeat.
On account of this, precious metals and base metals are expected to trade higher today. Additionally, a weaker dollar will also act as a supportive factor for prices.
We expect crude oil prices to trade with a positive bias today, on account of a supply concerns from Iran. Additionally, a weaker dollar coupled with positive sentiments in the markets will also provide further support for oil prices.