Bullion glitters at the top

Updated: Jan 5 2006, 06:23am hrs
The bears still have the upper hand in the domestic futures exchange as most of the commodities ended the day in red. But the bright spot to emerge from the day was the fact that the bullion is back to its glittering best. The yellow metal surged to Rs 7800 mark today on the back of firm international prices. The metal is at this level after Dec 13, 2005 when overseas gold was ruling at $525 an ounce level and rupee was down at 46 against the US dollar. Tracking gold silver also reached a New Year high of 13675 before some profit booking saw the prices tumbling on some intraday profit taking. But the trend for the bullion looks to be great with new records beckoning at their doorstep. Crude oil also saw some profit taking place as it lost out nearly a percent of its overnight cap.

Market watch

It was the turn of the edible oils to enjoy the fortunes as all the constituents benefited during the day. The one commodity that benefited most was mustard seed futures that settled marginally higher, mainly tracking the domestic soy seed futures. Soy seed futures settled moderately higher, tracking gains in CBOT and DCE soy markets. But demand in the cash market is still weak ahead of a good summer crop but overall bullish sentiments have driven the market throughout the day. The cash market demand is recovering and crushers are comfortable in terms of crush margin, as soymeal prices are also roaring up.

Spices failed to make a mark for the second day and most of the spices were remaining range bound. Pepper looks uncertain in the short run, as the uncertainty that prevails over the held up stocks lying with Marketfed is likely to bring new twists to the equation as the anticipation reaches new highs. The reports that add further fire to the equation are that of huge stock piled up in one of the exchange.

Courtesy: Geojit Commodities Ltd