Bloodbath at bullion hub; gold, silver crash to multi-year low
Mumbai: The domestic bullion hub witnessed bloodbath and a near-term breakdown on Saturday with both the precious metals -- gold and silver-- crashing to multi-year low on the back of frantic unwinding sparked by global liquidation worries.
The yellow-metal nosedived to touch a one-year low and closed below the Rs 28,000 per 10 gram level as panic-stricken investors and speculators went on a selling spree.
Standard gold of 99.5 percent purity tanked by Rs 1,010 to conclude at Rs 27,880 per 10 gm from overnight closing level of Rs 28,890.
Pure gold of 99.9 percent purity also plummeted by a similar margin of Rs 1,010 to finish at Rs 28,015 per 10 grams from Rs 29,025.
The industrial metal, silver, too, crumbled to re-test 15-month low and ended below the Rs 51,000 per kilo mark.
The shiny metal lost a massive Rs 1,010 or 3.50 percent per 10 gram, registering its second steepest plunge since August 25, 2011. While silver tanked by a hefty Rs 1,890, or 3.60 percent per kilo.
"Domestic sentiment is extreme negative at this juncture and investors are taking out money fearing the prices of yellow-metal may fall further as it is more vulnerable to global momentum where it is undergoing a drastic correction phase on improving economic environment, a bullion dealer said.
The fall in precious metals at a breathtaking speed is quiet alarming and fears a total meltdown if global crisis deepens, he added.
Silver ready (.999 fineness) tumbled by Rs 1,890 to settle at Rs 50,605 per kg from Friday's closing level of Rs 52,495.
Globally, gold encountered a catastrophic of sell-off and crashed below the USD 1,500 an ounce mark, its lowest level following intense selling by gold ETFs as well as unwinding long speculative positions by investors.
Disappointing data on US retail sales and consumer confidence amid heightened speculation surrounding over possible gold sales by Cypriot central bank along with other debt-stricken euro zone members to tide over its financial crisis, further dampening sentiment.