Expect precious, base metals to trade higher: Geojit

Asian markets opened higher today weak new home sales data from the US released yesterday has increased speculations that the Federal Reserve may take strong actions in order to accelerate the economic growth of the world's largest economy. US new home sales declined more that expected  by 32,000 to 350,000 in June as against 382,000 in May. However, European markets are trading lower today as concerns with respect to Euro
Zone debt crisis still persists which kept investors to remain cautious. On the macroeconomic front, the unemployment claims, pending home sales, core durable goods orders and durable goods orders data from the US is scheduled to be release later in the evening today. Investors will be closely watching the outcome for the data which is expected to be on a negative note, with unemployment claims being an exception which is expected to decline.

Spot gold prices are trading on a choppy note today on account of a stronger dollar index and mixed sentiments in the global markets. The yellow metal touched an intra-day low of $1600.6/oz and was hovering around $1604.6/oz till 2.30 pm IST today. MCX Gold August contract traded on a flat on account of appreciation in the Indian Rupee and touched an intra-day low of Rs. 29,751/10 gms till 2.30 pm IST.

Spot silver prices came under pressure and declined around 0.1 percent today taking cues from strength in the US dollar index along with fall in gold prices. Silver is precious as well as an industrial metals too, s it also took cues from fall in base metals complex. On the MCX, Silver September contract witnessed a fall of around 0.3 percent and hit an intra-day low of Rs. 53,150/kg till 2.30 pm IST today. Strength in the Indian currency led further decline in the domestic bourses.

We expect precious metals and base metals to trade higher in the evening session today taking cues from revival in the global markets after the comment from ECB President Draghi to do whatever to help Euro. This has lifted Euro and exerted downside pressure on dollar which will in turn be positive for metal prices today.

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