Precious metals end marginally lower

Prices move between small gains and losses throughout the session

Bullion metal prices ended little lower on Wednesday, 11 April 2012 at Comex. Trading was tentative Wednesday morning as the market place digested news out of the Indian Ocean region, where a major earthquake occurred near Indonesia overnight. The key outside markets were bullish for the precious metals Wednesday as crude oil prices were higher and the U.S. dollar index was lower.



Gold for June delivery ended lower by $0.40 or 0.02%, to end at $1,660.3 an ounce on the Comex division of the New York Mercantile Exchange on Wednesday. The metal veered between small losses earlier during the day. The metal had shed 2.5% last week.

On Tuesday, silver prices for May delivery ended lower by $0.16 or 0.5% at $31.52. Last week silver lost 2.3%.

The gold market did back off modestly on Wednesday afternoon in the immediate aftermath of a more upbeat Federal Reserve “beige book” report that suggested the U.S. economy continues to improve implying that any further quantitative easing of U.S. monetary policy is less likely.

The European stock markets rebounded overnight following solid selling pressure on Tuesday. U.S. stock indexes followed suit. The European Union debt crisis, which had been simmering on the back burner, could be heating up again. Traders will continue to closely monitor European stock and bond markets for any clues on the situation. Any serious escalation in the EU debt crisis would likely seen a return of safe-haven investment demand for gold.

In the currency market on Wednesday, the Dollar Index, which weighs the strength of dollar against basket of six other currencies fell by almost 0.1%. The dollar fell against the euro on Wednesday as stocks recovered and Spanish debt yields fell but pared losses slightly after a Federal Reserve report didn't yield any new clues on a new round of quantitative easing

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. But bullions have registered increase in prices despite strong dollar in recent times and vice versa.

At the MCX, gold prices for June delivery closed lower by Rs 31 (0.1%) at Rs 28,602 per ten grams. Prices rose to a high of Rs 28,692 per 10 grams and fell to a low of Rs 28,541 per 10 grams during the day's trading.

At the MCX, silver prices for May delivery closed lower by Rs 250 (0.44%) at Rs 56,017/Kg. Prices opened at Rs 56,110/kg and fell to a low of Rs 55,851/Kg during the day's trading.