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Diwali sparkle: Gold stocks up ahead of festivals, weddings

September 22, 2014

Mumbai-India (Sept 22)  Investors are busy buying stocks of gold jewellery companies ahead of festivals like Diwali, Dhanteras and wedding season. Tracking a weak global trend, gold prices also fell 0.36 percent to Rs 26,605 per 10 grams in futures market today as speculators trimmed their positions.

At the Multi Commodity Exchange, gold for delivery in December was down by Rs 95, or 0.36 percent, to Rs 26,605 per 10 grams in a business turnover of 26 lots. Similarly, the yellow metal for delivery in October lost Rs 90, or 0.32 per cent, to Rs 26,406 per 10 grams in 354
lots.

Analysts said the fall in gold futures was mostly in line with a weakening trend in the global market where metal prices fell to an eight-month low as the outlook for higher US borrowing costs strengthened the dollar, dampening demand for a store of value. Gold sales are expected to rise by 15 percent to 20 percent this festive season from year-ago levels.

According to experts, India's monthly gold imports are set to rise by as much 50 percent from current levels while premiums could almost double as the country gears up for a surge in demand ahead of the year-end festivities and wedding season.

Last week, Sanjeev Bhatia, CFO, PC Jeweller said in an interview to CNBC-TV18 that the upcoming festive season can be expected to be a bumper one.

“Now what we are seeing, the things are returning back to normal, people are coming back and the gold prices are stable. What we are witnessing is a back in the consumer footfalls as well as up going sales and more conversion of footfalls into sales as well. If the same trend continues then the upcoming festive season can be expected to be a bumper one,” he said.

Source: MoneyControl

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