Silver continued to post margins and witnessed third-consecutive daily gains, that too considerable.
Silver futures for September delivery remained firm since opening and hung on to its gains after a better-than-forecast July reading of the ISM manufacturing index and an unexpected climb in June construction spending. Moreover, positive stock markets and stronger base metals cemented the gains in silver. LME’s base metals index rose more than 3% yesterday.
Facts:
The greenback fell 0.75% to 80.938, despite better-than-expected data releases and positive US stock markets.
US stock markets kicked off the month with a bang and posted gains in triple-digits. The Dow Jones closed up 208 points and helped the benchmark MSCI world index post considerable gains of nearly 2.5%.
Ishares silver trust maintained its silver holdings at 9185.29 MT yesterday. MCX silver futures for September month were up by 1.24% to close at Rs. 28,990/kg on Monday. Rupee appreciation squeezed the profits in silver on MCX.
Outlook
Silver is trading tad lower at $18.38/oz, as LME’s electronic session is down. Silver may track base metals during the day. Mixed economic data from the US may not support the rally in stock markets during US hours. However, actual may turn around the markets.
Moreover, Asian equities are seeing a follow through effect after US markets closed on higher note. Silver may see initial dips with possible gains later on. CFTC reports also showed that non-commercial holders built-up huge short positions in the last two weeks which may now start covering their short positions. KCTL recommends buying silver at dips for the day.
