Gitanjali Gems was the biggest loser among the jewellery stocks, down 20 percent to its lower circuit limit in morning trade. Others like TBZ and PC Jeweller also tumbled 13 percent and 10 percent respectively.
Gitanjali Gems led the plunge, down 20 percent on NSE. TBZ also tumbled as much as 16.6 percent and PC Jeweller declined near 16.5 percent during the session. Shree Ganesh Jewellery House fell 10.5 percent and Titan Industries declined over 4 percent.
Spot gold prices touched near three-year lows last week and remained under pressure on Monday on the back of an appreciating US Dollar, and worries over early end to the stimulus by the US Federal Reserve. Gold demand has also slowed in India following measures taken by the government to curb gold imports as it battles a high current account deposit (CAD).
Spot gold price was down about 0.5 percent to USD 1,290.65 per ounce and Comex gold price declined to USD 1,290.10 in the international market.
Gold August contract on the Multi Commodity Exchange (MCX) was down 1 percent at Rs 26,755 per 10 gram.
Gold imports in India are likely to halve to about 150 tonne in July-September quarter, from projected 350 tonne in April-June, Press Trust of India said quoting Suresh Hundia, president (emeritus), Bombay Bullion Association.
The government, hiked gold import duty to 8 percent earlier this month to contain high CAD. Reserve Bank of India also issued new guidelines, according to which jewellery retailers can't use credit to buy gold and all gold will have to be purchased by paying cash upfront.
Gitanjali Gems finally closed at its 20 percent lower circuit limit of Rs 400.90. TBZ ended down near 8 percent at Rs 180.65, PC Jeweller shed 9.6 percent at Rs 88.50, Shree Ganesh Jewellery ended down near 9 percent at Rs 74.55 and Titan Industries was at Rs 222.50, down 0.2 percent.
READ MORE ON Gold prices, Spot, MCX, gold import duty, RBI, cash payment, Titan Industries, Gitanjali Gems, PC Jeweller, TBZ, Tribhovandas Bhimji Zaveri
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