Gold opened lower today at MCX in the morning by almost 450 rupees however spot gold above $920 an ounce on buybacks by recent sellers, but activity was slow as investors focused on how much further the stock market would fall. Risk-averse investors have rushed to buy bullion over the past few weeks, pushing it above the psychologically important $1,000 level on Feb. 20, but hefty losses in equity markets on concerns over the global financial sector on Monday triggered a wave of selling to cash in the alternative asset. MCX gold remained supported throughout the day as the USD appreciated against the INR and touched a high of Rs.52.13 to a dollar.
Crude oil hovered around $40 a barrel. OPEC oil supply fell in February for a sixth straight month as members enforced a deal to cut output and prop up oil prices, but output remained above target levels, a Reuters survey showed on Monday. Oil prices sank as a deteriorating world economy threatened to cut further into fuel consumption, outweighing OPEC's strong compliance with supply curbs. U.S. crude inventories rose 900,000 barrels last week, as imports rose, a preliminary Reuters poll ahead of weekly inventory data due out on Wednesday showed. Distillates and gasoline stocks fell, the poll showed. Base metals held buoyant. Copper futures snapped a two- day losing streak on Tuesday, rising around 1.5 percent in London and Shanghai as purchasing by China is supporting the demand as well as prices.
Bearish sentiment saw some relief after copper stocks fell 5,800 tonnes. However Peru's largest federation of mining unions has withdrawn its threat to strike in March. Canceled warrants, or volumes scheduled to be taken out of LME warehouses, have nearly quadrupled in the past two weeks. Most gains were recorded in South Korea, the closest location to China. There is speculation the state reserve may have bought as much as 300,000 tons for delivery between now and July, and 200,000 tons in the later part of the year, according to Southwest Futures Co. LME lead rose to $1,078 a ton, and zinc climbed to $1,134 a ton, Aluminum climbed to $1,343.
