Gold loses Rs 155, silver sheds Rs 700 on weak global cues

While gold declined by Rs 155 to Rs 28,785 per 10 grams, silver shed Rs 700 to Rs 53,500 per kg. Traders said sentiment turned bearish after gold fell to a four-month low in global markets as concern that Europe's debt crisis is deepening strengthened the dollar and cut the precious metals' appeal as an alternative asset.

Trend in the overseas market normally sets a price in the domestic market, they added. In London, gold fell by 1.3% to USD 1,573.82 an ounce, while silver traded lower by 1.9% to USD 28.51 an ounce.

Further, sluggish domestic demand at prevailing higher levels and a lower trend in the futures market also influenced the trading sentiment. Back home, gold of 99.9 and 99.5% purity plummeted by Rs 155 each to Rs 28,785 and Rs 28,645 per 10 grams, respectively.

Sovereigns traded lower by Rs 50 to Rs 23,700 per piece of eight grams. Silver ready dropped by Rs 700 to Rs 53,500 per kg and weekly-based delivery by Rs 555 to Rs 54,140 per kg.

Silver coins also tumbled by Rs 2,000 to Rs 61,000 for buying and Rs 62,000 for selling of 100 pieces due to poor demand at higher levels.