Precious Metals Decline On Firm US Dollar Index

Spot gold prices declined around 0.4 percent on Thursday on the back of a stronger dollar coupled with choppy sentiments in the global markets.

Additionally, fall in crude oil prices also affected the inflation-led demand for gold yesterday.

The yellow metal touched an intra-day low of $1627/oz and ended its trading session at the level of $1642/oz on Thursday. However, MCX Gold April contract rose around 0.2 percent on account of a weaker Rupee and hit an intra-day high of Rs27,937/10 gms yesterday.

Silver

Taking cues from fall in gold prices coupled with strength in the US dollar, spot silver prices declined sharply by 2 percent on Thursday. Silver being an industrial metal also took cues from downside in base metals complex.

The white metal touched an intra-day low of $31.06/oz and ended its trading session at the level of $31.5/oz yesterday. On the MCX, Silver May contract slipped around 1 percent as further decline was resisted due to a weaker Rupee and touched an intra-day low of Rs55,901/kg on Thursday.

Crude Oil To Edge Lower On Unfavorable Economic Data

Nymex crude oil prices declined sharply around 1.8 percent on Thursday on the back of unfavorable economic data from the Euro Zone front and China. This increased worries over global economic growth and in turn escalated global oil demand concerns which also acted as a negative factor for oil prices.

Crude oil prices touched an intra-day low of $104.50/bbl and closed at $105.40/bbl in yesterday’s trading session. On the MCX, oil prices declined by 0.5 percent and closed at Rs. 5418/bbl after touching an intra-day low of Rs.5401/bbl on Thursday.

Natural Gas

Nymex natural gas prices declined around 3.5 percent yesterday on the back of more than expected rise in US natural gas inventories.

Additionally, a stronger dollar and rise in risk aversion in the global markets also exerted further downside pressure on gas prices.

Natural gas prices touched an intra-day low of $2.25/mmbtu and closed at $2.262/mmbtu on Thursday. On the MCX, prices declined by 0.3 percent after touching an intra-day low of Rs.116.1/mmbtu and closed at Rs.118.1/mmbtu yesterday.

EIA Inventories

US Energy Information Administration (EIA) released its weekly inventories yesterday which showed that natural gas inventory has increased more than expected by 11 billion cubic feet (bcf) to 2.380 trillion cubic feet for the week ending on 16th March 2012.

Base Metals Weigh Down On Global Debt Worries

Unfavorable economic data from China and Euro Zone led base metals complex to trade lower on the LME on Thursday.

Additionally, rise in risk aversion in the global markets due to increasing worries with respect to global economy also exerted further downside pressure on metal prices.

However, depreciation in the Indian currency cushioned sharp decline on the domestic bourses on Thursday. The Indian Rupee depreciated sharply around 1.3 percent and closed at the level of 51.28 yesterday.

Lead

Lead was the worst performer amongst the base metals pack on Thursday, as the metal declined more than 2 percent on the LME and around 0.6 percent on the MCX.

Sharp rise in the metal inventories, a stronger dollar and poor sentiments in the markets acted as a negative factor for the metal prices. Lead inventories rose sharply by 1.1 percent to 373,850 tonnes on the LME warehouses on Thursday.

The metal touched an intra-day low of $1979/tonne and closed at the level of $1995/tonne yesterday. On the MCX, Lead March contract touched an intra-day low of Rs101.80/kg and ended at the level of Rs102.2/kg yesterday.