Gold tumbles on weak global trend

Gold prices tumbled on the bullion market today on heavy selling by stockists triggered by weakening international trend and closed by Rs 95 at Rs 9,025 per 10 grams.

Reports of the precious metal trading near $670 an ounce in Asia amid speculation that a fall in base metal prices in London overnight will reduce investors' demand mainly influenced the trading sentiment.

Gold, which dropped to a five-week low of $664.33 on May 10, had its first weekly decline in last 10 weeks. Spot prices for base metals such as copper, lead, nickel and zinc all fell on the London Metal Exchange.

Marketmen said a weak international trend, which normally sets prices in domestic markets, remained the prime factor behind the fall here.

They said end of the current marriage season was an additional factor for the weak trend. Standard gold and ornaments dropped by Rs 95 each at Rs 9,025 and Rs 8,875 per 10 grams respectively. Sovereign was unchanged at Rs 7,699 per piece of 8 grams.

Silver ready was further down by Rs 120 at Rs 18,380 per kilo and weekly-based silver lost Rs 170 at Rs 18,250 per kilo. Silver coins also plunged by Rs 200 at Rs 24,000 for buying and Rs 24,100 for selling of 100 pieces.

Bloomberg adds: Gold traded near $670 an ounce in Asia amid speculation a fall in base metals prices in London overnight will reduce investor demand for the precious metal. Silver was little changed.

Gold, which dropped to a five-week low of $664.33 on May 10, had its first weekly decline in ten last week. Spot prices for base metals such as copper, lead, nickel and zinc all fell on the London Metal Exchange yesterday.

"Gold seems to be the poor cousin of the base metals markets which continue to be under pressure and gold, on the back of that, is just drifting off,'' Jonathan Barratt, managing director of Commodity Broking Services in Sydney, said.

Gold for immediate delivery fell as much as $1.20, or 0.2 per cent, to $668.55 an ounce and traded at $669.45 at 3:24pm Sydney time.