Silver prices extended losses for the second straight day in futures trade on Friday as investors intensified profit-booking amid a firm US dollar and easing global geopolitical tensions.
On the Multi Commodity Exchange (MCX), silver futures for March delivery dropped by Rs 8,198 per kilogram in a business turnover of 6,160 lots. During the intraday trade, the white metal slumped Rs 14,628, or 6 per cent, to hit a low of Rs 2,29,187 per kg.
On Thursday, silver had depreciated by Rs 25,035, or 9.3 per cent, to close at Rs 2,43,815 per kg.
"Silver prices fell again on Friday, ending a short-lived two-day rebound as the recovery failed to sustain. Rising volatility across precious metals led to broad deleveraging, with silver underperforming as hopes of dip-buying faded quickly," Renisha Chainani, Head - Research at Augmont, said.
Akshat Garg, Head - Research & Product of Choice Wealth, said, "Silver has come off mainly because it had run up too fast in a short period. Over the past year, prices had moved sharply higher and a lot of optimistic positioning had already been built in.
"When markets are stretched like that, even small changes in global cues can trigger a correction. A slightly stronger dollar and some cooling in global risk appetite are prompting investors to cut exposure to volatile assets," Garg added.
Gold futures opened on a weak note but pared all of its losses later in the day to trade higher at Rs 1,53,047 per 10 grams, up by Rs 976, or 0.64 per cent on the MCX.
In the previous session, it had slipped Rs 975, or 0.64 per cent, to settle at Rs 1,52,071 per 10 grams. Mirroring the domestic trends, silver and gold prices weakened on the Comex in the international markets.
Silver futures for March delivery fell by USD 4.78, or 6.23 per cent, to USD 71.93 per ounce.
In the intraday trade, the white metal plunged by USD 12.81, or nearly 17 per cent, to touch a low of USD 63.90 per ounce.
Gold for April contract also slipped by USD 18.34, or 0.38 per cent, to USD 4,871.16 per ounce from Thursday's closing level of USD 4,889.5 per ounce.
Bullion prices declined on Friday despite weaker labour data which reinforced expectations for Federal Reserve rate cuts later this year, with market participants eyeing a first move in June, Jigar Trivedi, Senior Research Analyst at IndusInd Securities, said.
Chainani of Augmont said that easing geopolitical tensions reduced safe-haven demand for gold and silver. The confirmation of talks between Iranian and US officials in Oman has tempered risk sentiment, with investors closely watching developments in the negotiations.
She added that in the near-term silver prices are expected to trade softly between USD 70-90 (Rs 2.25-2.85 lakh per kg).
"A breakdown below USD 70 per ounce in global markets may trigger further downside towards USD 64 (Rs 2 lakh per kg)," Chainani said.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
