Gold ETFs recover up to 15% from lows as precious metal’s futures reclaim Rs 1.5 lakh/10 grams, silver rises 7% intraday

Gold and silver

• Gold ETFs recovered up to 15 percent intraday after an early sharp crash
• Silver ETFs remain down despite a 7 percent intraday jump in silver futures
• BSE set a 20 percent price band for gold and silver ETFs based on T-1 NAV

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Gold exchange traded funds (ETFs) staged a strong recovery from their early morning lows on February 1. This came as the yellow metal’s prices partially recovered after extending the sharp crash.

Silver ETFs are yet to recover, despite the precious metal seeing some rise on MCX intraday, as seen at 10.20 am.

Recovery in gold, silver prices:

Gold futures with April expiry reclaimed the Rs 1.51-lakh mark, after hitting a low of Rs 1,38,634 per 10 grams earlier during the day. This marks a 9 percent intraday jump from day's low. The futures are however still down in the red around 0.5 percent.

Silver futures with March expiry reclaimed Rs 2.8-lakh mark, after hitting a low of Rs 2,65,652 per kilogram in the early trading hours of Sunday. This marks a 7 percent intraday jump from day's low. The future contracts are still down more than 2 percent.

Baroda BNP Paribas Gold ETF, which had declined 16 percent in the early trading hours of the day, recovered around 15 percent to hit the day’s high at Rs 156.15 apiece. It is however still down 2 percent from its previous closing price.

Motilal Oswal Gold ETF and several other gold ETFs also recovered around 15 percent intraday, mirroring the volatility in the precious metals.

Stock exchange fixes price band for gold, silver ETFs:

After the sharp volatility in the precious metals and subsequently in ETFs wiped off significant amounts of investor wealth, BSE issued a notice saying that the reference price for these ETFs shall be based on the T-1 NAV, as published by the respective Mutual Funds/Asset management Companies.

Accordingly, the prescribed price band of 20 percent on both upper and lower end shall be applicable to the said T- 1 NAV price for trading purposes, BSE said.

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