Gold and silver ETFs tumbled up to 7% on Thursday after gold and silver prices opened sharply lower on the Multi-Commodity Exchange (MCX). Sentiment turned cautious amid escalating tensions in the Middle East and a spike in crude oil prices following fresh US strikes on Iran.
SBI Gold ETF fell the most by 7% to hit the day’s low of Rs 116.32 against previous day's close of Rs 125. This was followed by Nippon India ETF Gold BEeS, Tata Gold ETF, HDFC Gold ETF, and Kotak Gold ETF, which were down 6% each. The other 16 gold ETFs slipped between 1% to 5%.
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Among the 18 silver ETFs in the market, all posted losses of up to 3% on Thursday, with ICICI Prudential Mutual Fund's Silver ETF emerging as the worst performer.
Anup Bhaiya, Founder, Money Honey, Wealth Services, told ETMutualFunds that yesterday, gold corrected sharply to around $4,150–$4,175 per ounce and silver dropped to $63–$65 amid a stronger dollar, rising rate-hike expectations, and macro pressures.
He further said that for long-term investors, this healthy pullback creates an attractive accumulation opportunity, supported by enduring safe-haven demand, central bank buying, and inflation-hedging fundamentals.
In the domestic market, MCX silver futures for July 2026 delivery were down Rs 5,012 (2%) to Rs 2,30,492 per kg. Gold futures for August 2026 delivery slipped Rs 1,573 (1%) to Rs 1,46,444 per 10 grams. In the previous session, gold ended in the red, while silver gained slightly.
Another sentiment dampener for ETF demand is the threat of higher inflation stemming from the escalating West Asia crisis. U.S. consumer inflation increased at its fastest pace in three years in May as the Middle East conflict raised the price of gasoline and other energy products, giving more ammunition for the Federal Reserve to keep interest rates unchanged into 2027.
The Consumer Price Index increased 4.2% in the 12 months through May, the largest gain since April 2023, the Labor Department's Bureau of Labor Statistics said on Wednesday.
In the international market, gold prices rebounded from a six-month low on Thursday on short-covering. Spot gold rose 0.4% to $4,089.12 per ounce by 0215 GMT, after hitting its lowest since November 21 at $4,022.09 earlier in the day. U.S. gold futures for August delivery were down 0.5% at $4,111.10. Spot silver rose 0.3% to $63.86 per ounce.
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Manoj Kumar Jain of Prithvi Finmart said gold has support at $4,040-$3,985 per troy ounce and resistance at $4,155-$4,210 per troy ounce in today's session. Silver has support at $62.50-$61.10 per troy ounce, while resistance is placed at $66.60-$69.10 per troy ounce.
( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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