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Gold Price Today, 23 Sep 2022: Gold trades flat on rise in US Dollar; check resistance, support

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Gold Price Today, Gold Price Outlook, Gold Price Forecast: Gold rate and silver silver were trading weak on Friday, on the back of muted global cues. On Multi Commodity Exchange, gold October futures were ruling 60 points or 0.12 per cent down at Rs 49,923 per 10 gram, as against the last close of Rs 50,000. Silver December futures were trading Rs 78 down or 0.13 per cent down at Rs 57,949 per kg on MCX. Globally, yellow metal prices were flat as the dollar held close to its recent peak while the likelihood of more aggressive interest rate hikes by the U.S. Federal Reserve also weighed on the appeal for non-yielding bullion, according to Reuters. Spot gold was flat at $1,671.60 per ounce, and US gold futures ticked 0.1% higher to $1,682.80.

Also read: Nifty may fall towards 17200 if index breaches 17500; be cautious on equity markets, stay light on positions

Gold has shown relative strength against rising US dollar and Treasuries. The US Dollar continues to trade near its highest level of 2002 and it seems gold is becoming immune to Fed’s hawkish stance. After strong recovery from Wednesday’s fall, gold continues to attract buyers around $1660-1650. Historically also after every Fed rate hike, gold has seen a relief rally and no fresh low after the event indicates gold is prime to move up. Indian rupee will also support gold in MCX and we would recommend gold to dip around 49700-49600 for long position intraday with stoploss of 49400 and expected target of 50100.

Navneet Damani, Sr. Vice President – Commodity & Currency Research, Motilal Oswal Financial Services

Gold gained some momentum, but was flat as the dollar held close to its recent peak while the likelihood of more aggressive interest rate hikes by the U.S. Federal Reserve also weighed on the appeal for non-yielding bullion. Updates regarding Russia -Ukraine war is once again in highlights after President Putin’s comments regarding partial mobilization and also referendum in Ukraine this weekend supporting the safe haven assets. The dollar index was down 0.1%, but not far from a 20-year peak, while the U.S. 10Y yield continued to inch higher, currently hovering above the 3.7 mark, in the wake of a 75 bps rate hike by the U.S. central bank and its hawkish outlook. Many central banks raised their interest rates this week, following the U.S. Federal Reserve in the fight against inflation, which has been sending shockwaves through financial markets and the economy. On data front, number of Americans filing new claims for unemployment benefits increased moderately last week, indicating the labour market remains tight despite the Fed’s attempt to cool demand with aggressive rate hikes. Today the focus will be on the preliminary Manufacturing and Service PMI data expected from major economies and comments from Governor Powell. Broader trend on COMEX could be in the range of $1640-1695 and on domestic front prices could hover in the range of Rs 49,600-50375.

Also read: Reliance New Energy to acquire 20% stake in solar tech company Caelux Corp to produce low cost solar modules

Ravindra Rao, CMT, EPAT, VP- Head Commodity Research at Kotak Securities

COMEX gold trades marginally lower near $1678/oz weighed down by firmness in the US dollar and bond yields. The US 10-year yield has jumped to 2011 high in reaction to Fed’s aggressive monetary tightening stance however spread between 2-year and 10-year yield has narrowed. The US dollar is still near its 2002 high but has lost some momentum following Bank of Japan’s intervention in the currency market. Gold has weathered the central bank decisions and managed to hold above recent lows indicating that dip buyers have emerged however a sustained rise is unlikely until the US dollar corrects significantly.

(The views in this story are expressed by the respective experts of the research and brokerage firm. Financial Express Online does not bear any responsibility for their advice. Please consult your investment advisor before investing.)

Nifty short-term trend positive, may move to 18000 once 17800 breached; 5 things to know before opening bell

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Indian equity markets are likely to extend gains on Friday. SGX Nifty hinted at positive start for BSE Sensex, NSE Nifty 50 as Nifty futures traded 86 points, or 0.48% higher at 17,905.50 on the Singapore Exchange ahead of today’s trading session. “Nifty likely to continue northward move towards 17900 – 18000 and then beyond the 18000 mark. On the flip side, if there is no aberration globally, 17700 – 17600 should now act as immediate support. Traders are advised to continue with an optimistic approach and use declines to add fresh longs. One can continue to focus on thematic movers and also, and the broader market remains the real flavor,” said Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel One.

5 things to know before share market opening bell

Global market watch: Wall Street’s main indices posted gains on Thursday, mainly lifted by financial institutions and healthcare companies, even as investors digested hawkish remarks from policymakers that cemented possibilities a large interest rate hike later this month. The Dow Jones Industrial Average, the S&P 500, and the Nasdaq Composite gained 0.6% each. Markets in Asia-Pacific were mostly higher today. Japan’s Nikkei 225 rose 0.61% and the Topix afvanced 0.35%. In South Korea, the Kospi was up 0.33% and the Kosdaq index rose 1.25%. In Australia, the S&P/ASX 200 also gained 0.25%.

Nifty Technical view: “A small positive candle was formed on the daily chart with minor lower shadow. Currently, Nifty is placed at the upper area of the sideways range of the last 6-7 sessions at 17800 levels. The market is also in an attempt of decisive upside breakout of the significant down trend line around 17800 levels. Hence, this area is going to be a crucial overhead resistance and a sustainable move above this hurdle could open a sharp trended movement for the market ahead. The short term trend of Nifty continues to be positive,” said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.

Nifty, Bank Nifty levels to watch for: “The support for Nifty has shifted around 17600 levels. While on the upside, 18000 may act as an immediate hurdle. On the other hand, Bank Nifty has support at 39000 levels, while resistance at 40700 levels. Overall, the nifty has given a breakout of resistance level now looking strong on charts, crossing 18000 level can show more upside rally. The sector-specific moment has been seen, Midcaps and small caps stocks are giving good momentum. One can add on dips,” said Palak Kothari, Senior Technical Analyst, Choice Broking.

FII and DII data: Foreign institutional investors (FIIs) were net buyers on Thursday as they bought shares worth Rs 2,913.09 crore, whereas domestic institutional investors (DIIs) turned net sellers as they offloaded equities worth Rs 212.61 crore on September 8, according to the per provisional data available on the NSE.

Also Read: IndiGo, Vodafone Idea, Jet Airways, Future Lifestyle, Adani Group stocks in focus on September 9, 2022

Stocks under F&O ban on NSE: Delta Corp remains the only stock in the NSE F&O ban list for today (September 9). Securities in the ban period under the F&O segment include companies in which the security has crossed 95 percent of the market-wide position limit.

FPIs turn net sellers again; withdraw Rs 7,600 cr from equities in September

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After infusing funds in the last two months, foreign investors turned sellers again in September and pulled out over Rs 7,600 crore from the Indian equity markets amid hawkish stance by the US Fed and sharp depreciation in rupee. With this, the total outflow by Foreign Portfolio Investors (FPIs) from the Indian equity markets has reached Rs 1.68 lakh crore so far in 2022, data with depositories showed.

FPI flows are expected to remain volatile in the coming months on slew of global and domestic factors, experts said.

Also Read: 5G to be available in over 200 cities by March 2023; BSNL 5G launch on Aug 15 2023: Ashwini Vaishnaw 

According to the data, FPIs have sold equities worth a net Rs 7,624 crore in September. This came following a net investment of Rs 51,200 crore in August and nearly Rs 5,000 crore in July. Prior to that, FPIs were net sellers in Indian equity markets for nine months in a row beginning October 2021.

Although FPIs started the month of September on a positive note, the pace of net flows was lower compared to August on the back of enhanced global uncertainty.

“Concerns over the aggressive rate hike by US Fed to control rising inflation, sharp depreciation in rupee, surge in US bond yields and fear of a global recession, fuelled pessimism among investors. “Continuing Russia-Ukraine war also dented sentiments,” said Himanshu Srivastava, Associate Director – Manager Research, Morningstar India.

The scenario turned adverse after hotter-than-expected inflation report dashed hopes that the US Federal Reserve would scale down its rate hikes in the coming months. The August US inflation edged 0.1 per cent higher from the preceding month to 8.3 per cent. Inflation stood at 8.5 per cent in August last year.

In addition, a 75 basis points (bps) rate hike by the US Fed for the third consecutive time last month to control inflation and indication of further aggressive rate hikes have made investors risk averse. This has also raised concerns over the global economic growth and fanned fears of the US economy going into recession, Srivastava said.

Besides, sharp depreciation in the rupee also triggered FPI outflows. Rising bond yields in the US provided investors an opportunity to move away from riskier markets during these uncertain times and invest in safe havens like US treasuries, he noted.

“With the dollar strengthening hard in September, there is a rush towards the safety of the US dollar… Indian rupee may lose much more ground in coming times and hence an exit now and a re-entry later may make sense for some,” said Alok Jain, smallcase manager and founder, Weekend Investing.

The FPIs may be exiting on pressures of redemption from emerging market funds of which India is a part, he added. On the other hand, foreign investors have pumped in Rs 4,000 crore in the debt market during September. Apart from India, FPI flow was negative for the Philippines, South Korea, Taiwan and Thailand, while it was positive for Indonesia during the period under review.

SC allows Sebi to conclude proceedings for Brickwork licence cancellation

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The Supreme Court on Friday allowed Sebi to conclude the proceedings for cancellation of Brickwork Ratings’ licence for allegedly violating various credit rating regulations.

A Bench led by Justice SA Nazeer stayed the Karnataka High Court’s orders that had rejected the Sebi’s plea to vacate its earlier orders that restrained it from concluding proceedings with regard to cancellation of the Brickwork’s license. The HC also stayed the Sebi’s order that rejected the Brickwork’s settlement application in August last year. The HC orders came on Brickwork’s petitions seeking a stay on Sebi’s proceedings against it on the grounds that it was not given a proper hearing.

The settlement proceedings filed by Brickwork was not maintainable on account of the statutory bar in terms of Regulation 5(2) of Sebi (Settlement proceedings) Regulation 2018 as the alleged default committed by the CRA had market-wide impact, caused loss to large number of investors and affected the integrity of the market, solicitor general Tushar Mehta and counsel Pratap Venugopal argued on behalf of Sebi. Mehta said that a party can’t claim settlement as a vested right.

The lapses on the part of Brickwork are “serious in nature as it compromises with the protection of interests of investors,” Sebi told the SC while challenging the HC order. The settlement proceedings filed by Brickwork was part of a purely voluntary process of amicable settlement and Sebi was empowered to exercise its discretion and the CRA could not compel it to arrive at a settlement in respect of the alleged violations.

Brickwork was denied the principles of natural justice during the course of the enquiry that led to the impugned report, senior counsel CA Sundaram argued while opposing any stay order. The agency did not receive full and complete inspection of documents and such denial meant that the company was unable to fully and properly understand the charges against it, Sundaram said, adding that the fact that Sebi has chosen to settle with some and not others, without assigning reasons for the same, amounts to a denial of natural justice and is arbitrary.

Also Read| US Stocks: Futures hit two-month lows as FedEx warning stokes slowdown fears

After a joint inspection of Brickwork, which is one of the seven Sebi-registered credit rating agencies (CRA), was conducted by Sebi and the RBI between October 2018 and November 2019, the markets regulator observed several lapses in Brickwork’s rating process and alleged that the CRA had failed to exercise proper due diligence and considerably delayed the disclosures about non-cooperation of the issuer.

MCX gold price to trade sideways to weak this week, investors await US CPI inflation data; check support level

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By Tapan Patel

Commodity prices traded higher with most of the commodities in the non-agro segment witnessing recovery during the week with Crude oil remained an exception on demand growth worries. Base metals gained on concerns over lower supply and weaker dollar. Gold prices traded higher with spot gold prices at COMEX ended 0.27% up at $1717 per ounce for the week. Gold October futures at MCX gained by 0.32% to Rs. 50529 per 10 gram despite a stronger rupee. The spot rupee rose by 0.27% to 79.58 against the dollar for the week. Gold ETFs extended outflows as holdings at SPDR Gold Shares declined to 967 tonnes from previous week’s 973 tonnes. The CFTC data showed that money managers have decreased their net long positions in gold by 19509 lots in the last week. 

Silver prices traded higher with spot silver prices at COMEX surged by 4.53% to $18.86 per ounce for the week. MCX Silver December futures rallied by 4.58% to Rs. 55050 per KG for the week. Silver prices rebounded sharply with recovery in industrial metals over higher demand prospects and lower supply worries. The CFTC data showed that Money managers have increased their bearish silver bets by 3573 lots in the last week.

Bullion prices ended higher, reporting the first weekly gain in the last four weeks supported by dollar decline and safe haven buying. The traders and investors weighed on the dollar dragging down from 20 year highs over inflation worries and slowdown fears. The dollar index declined and precious metals rallied despite a push from US FED for another outsized rate hike to keep inflation down, when the central bank meets on Sept. 21. The Fed is committed to tackle inflation reaching 40-year highs on rising energy and food costs. The EuroZone slowdown worries are growing with a surge in energy cost ahead of the crucial winter season as industries are forced to shut operations due to high energy prices. The dollar index ended 0.48% down at 109 hitting a low of 108.35 for the week. The market players are awaiting key US CPI data due on Tuesday this week. 

Also read: Nifty looks set to hit 18160-18600 in near term, Bank Nifty shows upmove; watch out for these levels

We expect gold prices to trade sideways to down this week with COMEX spot gold resistance at $1740 per ounce and support at $1676 per ounce. At MCX, Gold October prices have near term resistance at Rs. 51500 per 10 grams and support at Rs. 49800 per 10 gram. COMEX Spot silver has near term resistance at $19.40 per ounce with support at $17.90 per ounce. MCX Silver December has important resistance at Rs. 57000 per kg and support at Rs. 52500 per kg

(Tapan Patel, Senior Analyst (Commodities), HDFC Securities. Views expressed are the author’s own.)

Govt hikes allocation of wheat under open market sale scheme

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The government has decided to offload 0.3 million tonnes (MT) under the open market sale scheme (OMSS) by the Food Corporation of India (FCI) in its weekly e-auction from next month, against 0.2 MT currently being offered for the bulk purchaser to cool down the prices.

Sources told FE that because of surplus stocks held by the FCI, the government may offer more quantity of wheat through weekly e-auctions so that prices do not spike during the current festive months.

FCI has sold more than 2.75 million tonnes (MT) of wheat from its stock in the open market through weekly e-auctions being held since June so far, thus, curbing the increase in the retail prices, a food ministry official said.

On Thursday, the corporation sold 0.19 MT of wheat, against 0.2 MT offered on the e-auction, and the target is to sell 5 MT of grain to the bulk buyers by the end of the year.

At present, FCI had 22.4 MT of wheat stocks against the buffer of 13.8 MT for January 1.

In August, to contain the rise in cereal prices, the government had announced the sale of 5 MT of wheat. Earlier food Secretary Sanjeev Chopra had stated that the government is considering several measures, including cutting import duty on wheat.

“We may sell more wheat in the open market, if needed to cool down the prices,” Chopra recently said.

The official said that the weighted average selling price of wheat under open market sale scheme on Thursday’s auction rose to a high of Rs 2,310.69/quintal against the reserve price of Rs 2,127.7/quintal.

Overall cereals retail inflation last month was still at double digits (10.95%), a marginal decline from 11.85% in August because of some softening of wheat prices.

The rate of increase in wheat prices declined to 7.93% last month on the year from 9.3% in August on the year.

To boost output, the government recently announced a 7% increase in the minimum support price (MSP) of wheat, to Rs 2,275/quintal for the 2024-25 marketing season (April-June) compared to the previous year.

In April 2019, India raised the duty to 40% from 30% as domestic prices had dropped, to discourage cheaper wheat imports.

Last month, the government reduced stock holding limits for wheat for traders, wholesalers and retailers to 2000 tonne from 3000 tonne, imposed three months back.

In the last couple of months, the government has announced a series of measures to check price rise, including a ban on white rice exports, initiating open market sale of wheat, rice from the central pool, and the imposition of stock holding limits, a measure last initiated in 2008.

Rupee hits new lifetime low, nears 82 mark on strong dollar, weak markets; USDINR support at 81

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The Indian Rupee fell to a fresh lifetime low of 81.90 in opening trade on Wednesday amid strong dollar, FII outflows, and risk-off sentiments in equity markets. The delay in Indian bond inclusion in the JP Morgan bond index also likely weighed on the local unit. In the previous session, rupee weakened past the 81.60 mark. On the flow side, there has been notable outflow since Fed’s hike day. “Surely, RBI will have to closely monitor the situation. If not today or tomorrow, then the expectation of direct or indirect intervention will rise on the Policy day- that is on 30th September,” said Amit Pabari, MD, CR Forex Advisors.

Also Read: Nifty above 16940 may hit 17200, momentum indicators signal possibility of pullback rally; Buy Cipla, LTI

Rupee may fall further to 82.20

“Stronger US consumer confidence and durable goods orders have pushed the American currency higher. US 10-year bond yield touched 4%, adding to the gains in the dollar. Hawkish statements from various Fed members too have supported the rally in the dollar. Amid RBI policy, we expect Rupee to decline further to 82.20 on spot. RBI is likely to increase rates higher by 50 bps,” said Jigar Trivedi, Senior Analyst – Currency & Commodity, Reliance Securities told FinancialExpress.com.

More weakness in Rupee ahead

“Weakness in the Chinese yuan and delay of India’s bond inclusion in the JP Morgan EM Bond Index weighed on the rupee in early trade today. The depreciation in the Chinese yuan, a stronger dollar index and foreign fund outflows could further weigh on the local unit in the near term. We believe the rupee could slip below 82 and may fall to 82.90 if the situation doesn’t improve while on the downside 81 will act as support,” Dilip Parmar, Research Analyst, HDFC Securities told FinancialExpress.com.

Also Read: Petrol, Diesel Price Today, 28 Sep 2022: Fuel cost static; check rates in Delhi, Mumbai, Noida, other cities

Importers can buy all dips as dollar remains King

“USDINR rises to 81.83 as US 10-year rises to nearly 4% on hawkish comments from US FED officials. The US dollar index also rose higher to 114.55 as Euro and GBP fell from their recent highs. The Asian currencies were all trading lower to the dollar as IDR fell to 15205, CNH to 7.22 and KRW to 1439. Equities over Asia were down after the Dow fell overnight on the hawkish comments. SGX nifty was trading down by 112 points. The range is expected to be between 81.50 to 82.00 for the day. Exporters are to continue to hold their export proceeds with a stop at 81.30 while importers will have to buy all dips as the dollar remains the King amongst all currencies,” said Anil Kumar Bhansali, Head of Treasury, Finrex Treasury Advisors.

(The recommendations in this story are by the respective research analysts and brokerage firms. FinancialExpress.com does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.)

SBI raises Rs 4,000 cr via Tier 2 bonds

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State Bank of India (SBI) on Wednesday raised Rs 4,000 crore through Basel-III compliant Tier 2 bonds, the lender said in a release. Funds were raised at a coupon rate of 7.57% payable annually for a tenure of 15 years with a call option after 10 years. This represents a spread of 14 bps over 10-year G-Sec.

SBI said the bonds attracted overwhelming response from investors with bids of ₹9,647 crore, and were oversubscribed by about 5 times against the base issue size of ₹2,000 crore.

The bank has ‘AAA’ (stable) credit rating from domestic credit rating agencies for these instruments. The bank has a strong resource profile, driven by high share of current and savings account (CASA) deposits, resulting in an extremely competitive cost of funds and a granular deposit base, leading to superior liquidity profile, ratings agency ICRA has said in a report.

SBI’s capital adequacy ratio was at 13.4% in the June quarter, compared with 13.7% in the corresponding quarter a year ago.

Sebi fines IL&FS Transportation Networks Rs 1 crore for related party transactions

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The Securities and Exchange Board of India (Sebi) on Thursday fined IL&FS Transportation Networks (ITN) Rs 1 crore for related party transactions in group companies of IL&FS Financial Services (IFIN). In addition, Ramchand Karunakaran, then managing director of ITN, Dilip Bhatia, its chief financial officer and Krishna Ghag, the secretary of the audit committee of ITN during the examination period were fined Rs 25 lakh each.

Sebi had observed certain RPTs in the form of loans borrowed by ITN from IL&FS group companies in the financial years 2015-16, 2016-17 and 2017-18, which allegedly violated the provisions of Sebi (Listing Obligations and Disclosure Requirements) Regulations, 2015, Uniform Listing Agreement dated November 24, 2015 and accounting standards on related party disclosures such as AS18 for FY2015-16 and IndAS 24 for FY2016-17 and 2017-18.

The group companies include Gujarat Integrated Maritime Complex, Unique Waste Processing Company, Tierra Enviro, Livia India, Kanak Resources Management, Mota Layja Gas Power Company, Rapid Metrorail Gurgaon South (RMGSL) and Sabarmati Capital Two.

Thursday’s order observed that ITN’s transaction with RMGSL resulted in the materiality threshold of 10% with regard to RPTs getting crossed in FY15-16 where transactions were 19.77% of the turnover of the previous financial years. The company also failed to take approval of shareholders for the same.

Also read| Sebi has no role in IPO pricing of new-age tech companies: Buch

Further, ITN failed to take approval of shareholders in terms of LODR regulations for the RPTs with IFIN for FY15-16 and FY17-18 when the transactions were more than three times the materiality threshold.

ITN also failed to comply with relevant accounting standards for the period of FY15-16, 2016-17 and 2017-18.

Sebi also said the defaults on the part of all the noticees were repetitive in nature.

Stocks to watch: RIL, Colgate-Palmolive, Axis Bank, Lemon Tree Hotels

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Stocks in Focus: GIFT Nifty traded up 48 points or 0.25% at 19,005.5, indicating a positive opening for domestic indices NSE Nifty 50 and BSE Sensex on Friday. Previously on Thursday, the NSE Nifty 50 tanked 264.90 points or 1.39% to settle at 18,857.25, while the BSE Sensex shed as much as 900.91 points or 1.41% to 63,148.15.

“Till date, the actual domestic Q2 results are below par in comparison to the excited earnings forecasted. Similar disappointments are visible in developed economies. Downgrade in earnings and valuation is arising due to risk of further slowdown of the economy due to geopolitical and elevated interest rates. Also selling pressure intensified due to expiry-led volatility influencing investors to stay cautious,” said Vinod Nair, Head of Research at Geojit Financial Services.

Colgate-Palmolive

The company posted profit for the second quarter of FY24 at Rs 340.05 crore, up 22.3% in comparison to Rs 278.02 crore during the same period last year, surpassing estimates. It posted revenue from operations at Rs 1471.09 crore, up 6% as against Rs 1387.48 crore during the second quarter of FY23. The company EBITDA stood at Rs 482.2 crore. EBITDA margins continued to improve, up 120 bps vs. sequential quarter and up 340 bps vs. prior year quarter driven by pricing and efficiencies.

Axis Bank

“The Board of Directors has approved the appointment of Munish Sharda as a Whole-time Director, designated as ‘Executive Director’ of the Bank (including his terms and conditions and remuneration), effective from (i) November 1, 2023; or (ii) the date of approval of his appointment by Reserve Bank of India (RBI), whichever is later,” said the Bank in a regulatory filing.

Lemon Tree Hotels

“The company has signed a License Agreement a 50 rooms property in Visakhapatnam, Andhra Pradesh under the Company’s brand ‘Red Fox Hotels’. The hotel is expected to be operational by FY 2026,” said the company in a regulatory filing.

The Karnataka Bank

The Committee of Directors of the Board of the Bank has approved the allotment of 3,34,00,132equity shares of face value of Rs 10 at a premium of Rs 229.52/- each on preferential basis to HDFC Life Insurance Company, Quant Mutual Fund, Bajaj Allianz General Insurance Company, Bajaj Allianz Life Insurance Company and Bharti AXA Life Insurance Company, said the Bank in a regulatory filing.

Companies scheduled to report their Q2 earnings today-

Bajaj Finserv

Maruti Suzuki

M&M Financial Services,

Cipla

SBI Life Insurance Company

Bharat Petroleum Corporation

Dr Reddy’s Laboratories

Union Bank of India

Oberoi Realty

(With agency inputs.)