In a dramatic reversal, silver prices in India tumbled sharply from their all-time peak on Thursday, witnessing a massive sell-off alongside a dip in gold. The plunge was triggered by a wave of profit-booking by investors in global markets, leading to a significant correction in precious metal rates.
Sharp Decline in Domestic Bullion Market
According to data from the All India Sarafa Association, the price of silver collapsed by a staggering Rs 12,500 to settle at Rs 2,43,500 per kilogram. This steep fall came right after the white metal had scaled a historic high of Rs 2,56,000 per kg in the previous trading session on Wednesday, having surged by Rs 5,000.
Gold was not spared from the downturn either. In the local bullion market, the price of gold of 99.9% purity decreased by Rs 900 to Rs 1,40,500 per 10 grams. This marked a drop from its previous closing rate of Rs 1,41,400 per 10 grams, inclusive of all applicable taxes.
Futures Trading Reflects Heavy Selling Pressure
The trading activity on the Multi Commodity Exchange (MCX) mirrored the bearish sentiment. Gold futures for the February delivery contract fell by Rs 896, or 0.65%, to Rs 1,37,113 per 10 grams. The business turnover for these futures stood at 14,957 lots.
Silver futures faced even heavier selling pressure as traders adopted a cautious stance. The March contract for silver on the MCX tumbled by Rs 7,365, translating to a 3% decline, to Rs 2,43,240 per kilogram. The trade was conducted across 12,295 lots, indicating substantial market participation in the sell-off.
Global Markets Set the Tone
The correction in Indian markets was in sync with trends in international exchanges. On the global front, gold futures for February delivery on the Comex slipped by $29.7, or 0.7%, to $4,432.8 per ounce. This global retreat from recent highs prompted investors and traders in India to lock in profits, leading to the sharp declines observed in both gold and silver prices.
The sudden reversal highlights the volatile nature of precious metal markets, where rapid gains can be quickly erased by profit-taking activity. Market participants will now watch for fresh triggers that could determine the next direction for bullion prices.
