Gold prices jumped Rs 1,395 to Rs 41,705 per 10 gram yesterday (Friday), following rally in the international prices of the precious metal. On Thursday, the precious metal had closed at Rs 40,310 per 10 gram.
Meanwhile, silver prices advanced Rs 2,889 to Rs 38,100 per kg against the previous close of Rs 35,211 per kg.
In the international market, both the metals were trading with hefty gains, with gold quoting higher at $1,514 per ounce and silver at $12.96 per ounce.
In fact, crude oil, precious metals and base metals all recovered on Friday from their recent lows on news of factories and retail showrooms in China gradually reopening after several weeks of lockdown following coronavirus (Covid-19) spread.
The Bombay Stock Exchange sensitive index (Sensex) also recovered by 1628 points to settle at 29,916.
Factories and retail showrooms have started re-opening in China after weeks of lock down. While many Asian and European countries continue to remain in the grip of Covid-19 and lock down continues there, the partial recovery of trade in China has raised hopes of life gradually coming back on track, and a rebound in demand in the coming weeks.
Meanwhile, base metals on the benchmark London Metal Exchange (LME) moved up in tandem with their movement on the Shanghai commodity exchange. Meanwhile, the decline in metal and energy prices was more pronounced on Indian exchanges than international ones due to a fall in the rupee against the dollar. The Indian currency slipped to a historic low of below Rs.75 against dollar on Friday.
Sentiment in commodities also improved due to the European Union’s decision to extend monetary support to an economy faced with the prospects of defaults. While China now appears to be containing Covid-19 effectively, European Union and other countries are finding it difficult to extricate themselves from the grip of the pandemic.