Crude oil fell below $80 for the first time in a year and copper headed for its biggest weekly drop in more than 20 years. The MCX Crude oil October contracts were down to trade at Rs 4,016 per barrel on Friday over the previous week. Crude oil prices are hitting new lows for the year and are poised to move southward till the time financial turmoil persists. Factors like sharp rise in oil stocks, rising dollar and no active hurricane in the Gulf of Mexico, are putting pressure on oil prices.
"We expect that trend in oil prices can remain bearish in the medium term with a price target of $75 per barrel," an analyst with Angel broking said.
The MCX Copper October contracts were lower by 12.64% to settle at Rs 242.80 per kg from Rs 277.95 per kg in the previous week. The red metal was further pressured down by rising inventories both on the London Metal Exchange (LME) and the Shanghai Futures Exchange. On the London Metal Exchange, copper for delivery in three months dropped $665, or 13 %, to $4,650 a metric tonne. Copper prices fallen below the $5,000 levels indicating major weakness in sentiments over demand and worries over global financial health, analyst said.
The MCX Gold December contracts were higher to settle at Rs 14,117 per 10 gram over the previous week. Prices are also supported by strong physical demand from investors. Demand for gold coins and a bar has increased substantially in last month. In India, high prices have kept buyers at bay, but demand will pick up by Diwali, a trader said.
"We expect gold prices to remain bullish in coming months, and expect international gold price to touch $975 in the short term," analyst with Angel Broking said.