1st March 2012,Thursday
Investors have turned bullish on silver with the white metal posting an 18% gain in the last eight weeks. The metal rose by Rs 2,000 on Wednesday to touch a two-month high of Rs 61,350 per kg. In early January, a kg of silver cost Rs 51,000.
The rally is mostly driven by Greece bailout and speculation on crude oil prices following Iran-US standoff. The metal traded in the range of $33-34 per ounce on Comex on Tuesday.
Bullion traders in India hope the price may touch a record high of Rs 1,00,000 per kg by this year-end if the rally sustains. "People are coming back to silver trading after a few months. If positive sentiments remain, silver prices may go over Rs 1 lakh crossing last year's Rs 75,000," said Ketan Shroff, MD of Pushpak Bullions.
In the short term, prices may touch Rs 63,000 per kg. Silver prices have doubled in the last two years mainly due to global factors.
"India may import over 5,000 tonne this year due to a strong demand from investors," said Prithviraj Kothari, president of the Bombay Bullion Association. The nation imported nearly 4,800 tonne of the metal last year on expectations of a rise in industrial and investment demand.
Traders have built short positions because they expect prices to react sharply in the immediate future than in the longer run. They are quite bullish on silver as the metal has not seen a significant surge in the past few months. New traders have also taken position in the market and are trading larger stocks.
"A lot of new trades have taken place on MCX and NCDEX in the last two months and, especially, last two days due to the Greece bailout and Euro stabilizing factors," said Naveen Mathur, who is the research head at Angel Broking.
Madan Sabnavis, chief economist, Care rating agency, says, "The dollar-rupee stabilization has attracted new investors into the market. We expect the prices to go up by 35% at the end of 2012 given the fact that global factors stand positive for the metal."
Silver is used in a wide range of industrial applications and its price therefore is affected by the pace of global economic activity. About 50% of the metal's total demand comes from industrial applications whereas demand from jewellery, silverware, coin and medal manufacturers account for 35% of the total demand.
Investors have turned bullish on silver with the white metal posting an 18% gain in the last eight weeks. The metal rose by Rs 2,000 on Wednesday to touch a two-month high of Rs 61,350 per kg. In early January, a kg of silver cost Rs 51,000.
The rally is mostly driven by Greece bailout and speculation on crude oil prices following Iran-US standoff. The metal traded in the range of $33-34 per ounce on Comex on Tuesday.
Bullion traders in India hope the price may touch a record high of Rs 1,00,000 per kg by this year-end if the rally sustains. "People are coming back to silver trading after a few months. If positive sentiments remain, silver prices may go over Rs 1 lakh crossing last year's Rs 75,000," said Ketan Shroff, MD of Pushpak Bullions.
In the short term, prices may touch Rs 63,000 per kg. Silver prices have doubled in the last two years mainly due to global factors.
Traders have built short positions because they expect prices to react sharply in the immediate future than in the longer run. They are quite bullish on silver as the metal has not seen a significant surge in the past few months. New traders have also taken position in the market and are trading larger stocks.
"A lot of new trades have taken place on MCX and NCDEX in the last two months and, especially, last two days due to the Greece bailout and Euro stabilizing factors," said Naveen Mathur, who is the research head at Angel Broking.
Madan Sabnavis, chief economist, Care rating agency, says, "The dollar-rupee stabilization has attracted new investors into the market. We expect the prices to go up by 35% at the end of 2012 given the fact that global factors stand positive for the metal."
Silver is used in a wide range of industrial applications and its price therefore is affected by the pace of global economic activity. About 50% of the metal's total demand comes from industrial applications whereas demand from jewellery, silverware, coin and medal manufacturers account for 35% of the total demand.
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