By: Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities and Currencies, Angel Broking Ltd

Uncertainty over the U.S. financial aid extended support to Spot Gold and Base Metal prices that ended in the green. China’s increased economic activities coupled with growth of Chinese GDP further supported industrial metals. Crude Oil ended marginally lower amid increased Oil Production and widening impact of the pandemic.


Spot Gold prices closed on the higher note increasing 0.28 percent to end at $1904.3 per ounce. The U.S. uncertainty on stimulus package kept the prices stable.

U.S. House Speaker Nancy Pelosi and Treasury Secretary Steve Mnuchin continued to resolve the rift between both parties. But many failed attempts in reaching a consensus weighed down on the hopes for the relief fund. Gold prices also received support from reinforcement of pandemic-related curbs in Europe as more global cases enhanced the appeal for the safe haven, Gold.

So far, high liquidity infusion by global central banks has driven gold prices by more than 25 percent this year. 


On Tuesday, Spot silver ended higher by 1.37 percent to close at $24.5 per ounce. The prices on the MCX gained about 0.7 percent and closed at Rs. 62,095 per kg. 

Crude Oil 

WTI Crude ended marginally lower on Tuesday by 0.12 percent at $40.8 per barrel. The increasing impact of the pandemic and surge in  Libyan Oil Production continued to weigh on the prices. 

Prices were also ticked by an alarming increase of COVID cases in Europe and North America. Moreover, increase in Libyan Crude output further weighed on the prices along with the resumption of its largest Oil Field, Sharara, amid bleak demand prospects. 

Today, official U.S. Crude inventory data will be published which will impact the prices. Fear of second wave along with higher crude inventory levels might weigh on the prices.

Base Metals 

On Tuesday, LME’s base metals ended positive as steady expansion in the Chinese economy and hopes over stimulus aid by the U.S. elevated the prices. 

China’s GDP rose about 4.9 percent from July’20 to September’20 and supported the industrial metals vis-à-vis 3.2% growth reported in the second quarter of 2020. 

However, the gains were limited as alarming increase in the new coronavirus cases in Europe and North America raised worries over demand outside China. 

In September’20, output of primary Aluminium in China stood at 3.16 million tonnes, marking an increase of 7.9 percent year on year. Increase in Aluminium prices and new smelters introduced in China led to the surge in production. 


LME Copper ended higher by 0.59 percent to close at $6,779.5 per tonne as solid expansion in China’s economy from June’2 to September’20 supported the red metal prices. Growing demand from China and hopes over additional stimulus by U.S. might support the industrial metal prices.

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