Bull Everywhere !

Globally almost all asset classes are again touching new highs. Just recently few days ago there were talks of crude oil staying above the $100 per barrel mark. Gold is also heading towards its all time high of $850, last time I checked it was around $830 per ounce. India being the largest consumer of Gold in the world is the major source of the increasing demand for this metal.

The price of gold in India per 10 gram is clearly above Rs. 10,000. The market analysts earlier had predicted that the gold will not touch the 10,000 level because the consumers would move away from gold due to the high price. Infact it was speculated that the gold prices will stay below Rs. 9,700 when the prices were touching the levels of Rs. 9,300.

Another main reason for the increase in the Gold and crude oil is due to depreciation of US dollar. The dollar has weakened in terms of Euro from the June levels of 1.34 to the levels of 1.45 now.


Year on year gold as an investment in India has not done extremely well with returns below 10%. But in the last few months it has made good return of close to 25% to 30%. Infact it makes more sense to invest in the gold overseas in dollar terms particularly in order to best capture the depreciation of dollar. The Gold ETF’s that were recently started in the county were a good example of this. Gold ETF’s have gone up by almost close to 30% in the last six months.

Metal Stocks to Loose

Over the last week the metal stocks have declined by close to 6%. This is due to the bear run in the various metal commodities in the international market. The brokers believe that many hedge funds who invested in commodities are selling and this would continue for a while pulling down the metal prices further down. There is also a speculation of cooling off of the Chinese Economy which was the main consumer pulling the the commodities during the bull run.
On wednesday Hindustan Zinc lost Rs. 15 to Rs. 598.

Gold at 11 week low

Gold prices continue to be hard hit in this week. The latest spot prices is arround $ 578.60 per ounce. This is nearly a fall of over 10% in the week from the high of $640.5 per ounce. Predictions are that it might touch levels of $ 550- $500 if a quick rebound does not take place. The same was the fate of silver which fell to $10.97 per ounce from above $ 12 per ounce a week ago.