Jewellery shares gain on hopes of export orders

Jewellery shares have firmed up hopes of export orders from the US ahead of the festive season

Shares of gems and jewellery makers have firmed up 2-5% on hopes of export orders from the US ahead of the festive season after recent data showed that the world's largest economy is showing signs of an uptick.

Home resales in the US surged to a 10-month high in July, factory activity in the mid-Atlantic region hit its highest level since March 2011 in August, and a gauge of future economic activity grew solidly last month.

Further, the US Labour Department said that initial claims for unemployment benefits in the week ended August 16, declined by 14,000 to a seasonally adjusted 298,000.

"After a sluggish trend over the past 2-3 years demand for jewellery from the US is like to pick up ahead of the Thanksgiving and Christmas season. Most of the big US retailers would be placing orders well in advance as demand is likely to revive with economy showing signs of growth," an analyst at an prominent brokerage said.

Meanwhile, global gold prices are trading at a 2-week low on the back of upbeat US economic data and fears that the US Federal Reserve may hike interest rates sooner-than-expected. The yellow metal is currently at $1,279.92 compared with $1,312.62 on August 7, 2014.

Rajesh Exports was up 3%, PC Jeweller gained 1.6%, Tribhovandas Bhimji Zaveri rose 3.6%, Shrenuj was up 1.5%, Shree Ganesh Jewellery House surged 6.7% and Tara Jewels jumped 5.2%.