Gold prices witnessed ac choppy trading session on Wednesday as prices failed to carry forward the momentum from the previous day. The market was in ranges with a slightly weaker bias yesterday as US economic data showed mixed figures. The equity markets of US had fallen initially as data showed that the manufacturing activity in the state of New York had declined. However, industrial output in the country climbed as expected, which helped the investors get their risk appetite back. Nevertheless, investment buying the yellow metal continued to rise. The world's largest gold-backed exchange-traded fund, SPDR Gold Trust said its holdings rose to 1,298.698 tonnes by Sept 14 from 1,292.619 tonnes by Sept 13. The holdings hit a record at 1,320.436 tonnes on June 29. The yellow metal is expected to stay on the upper side as festival season during September to November in India, the largest consumer of gold, will boost the demand for the metal. Reports show that gold imports of India is expected to reach 504.5 tonnes for the year 2010, up 24.5 tonnes as compared to 2009. ENERGY Crude oil prices dipped on Wednesday ending below the previous day’s closing price as reports that the Enbridge pipeline is will be restarting operations shortly. However, the market erased some of its earlier losses following the release of EIA data that showed that inventories of crude oil dropped for the second consecutive week. Light, sweet crude oil futures for October delivery on the New York Mercantile Exchange settled 78 cents, or 1%, lower at $76.02 a barrel. The Energy Information Administration said U.S. crude oil stocks fell by 2.489 million barrels in the week ended Sept. 10, in line with market expectations and counter to a surprise large increase reported by a trade group a day earlier. Gasoline inventories fell by 694,000 barrels and distillate stocks (diesel/heating oil) declined by 340,000 barrels. Refiners trimmed operations relative to capacity by 0.6 percentage point, but lifted crude oil processing to a one-month high above 15 million barrels a day. Natural gas prices climbed yesterday as the momentum that the market picked following storm threats to the production facilities remained. However, the storms have not affected the production facilities so far. Hurricane Igor and Hurricane Julia are both projected to turn toward the northern Atlantic rather than the Gulf of Mexico, according to the National Hurricane Center. Tropical Storm Karl, which formed in the southwest Gulf on Tuesday, is expected to make landfall in Mexico over the weekend. All three storms will miss the main gas-producing portion of the Gulf, off the Texas and Louisiana coastline, by a wide margin. The Gulf produces about 11% of U.S. gas output, and the approach of a severe storm can cause prices to spike. Natural gas for October delivery rose 4.7 cents, or 1.2%, to $4.013/MMBtu on the New York Mercantile Exchange. BASEMETALS Base metals were trading in ranges and with negative bias on Wednesday following weaker than expected manufacturing data from the US. The market was also pressured by the fears of monetary tightening from China, the largest consumer of base metals. However, stocks of the red metal continued to fall at warehouses monitored by the London Metal Exchange. London Metal Exchange copper warehouse stocks fell by 1,025 tonnes to 389,500 tonnes. Stockpiles shed more than 14,000 tonnes in August.

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