- Precious metals rallied as a weaker dollar and falling crude boosted investor interest
- Silver ETFs led gains, with Nippon India Silver ETF rising 2.62% by afternoon trading
- Gold ETFs rose modestly, with ICICI Prudential Gold ETF up 1.74% during the session
Precious metals witnessed a significant surge on Wednesday, with silver-backed assets leading a broad-based rally as a weakening dollar and sliding crude oil prices boosted investor appetite. While gold exchange-traded funds (ETFs) recorded steady growth, silver ETFs stole the spotlight by climbing over 2.5% during the session.
The Nippon India Silver ETF emerged as a top performer, rising 2.62% to trade at Rs 234.89 by the afternoon. Close behind, the ICICI Prudential Silver ETF jumped approximately 2.6% to reach Rs 244.99, while the Tata Silver ETF and SBI Silver ETF posted gains of 2.58% and 2.57% respectively.
Gold-linked instruments followed this upward trajectory, though their advances were more measured. The ICICI Prudential Gold ETF climbed 1.74% to Rs 128.75, while the SBI Gold ETF rose 1.66%. Similarly, the Nippon India ETF Gold BeES and Tata Gold ETF edged up by 1.63% and 1.61% respectively.
The momentum in the ETF space was a direct reflection of the heating up of domestic futures on the Multi Commodity Exchange (MCX). Silver futures for July delivery opened at Rs 2,49,316 per kg, a 2.04% increase, before surging further to Rs 2,54,338—marking a 4.1% leap from the prior close. Gold futures for June delivery also saw a sharp uptick, opening at Rs 1,52,000 per 10 grams, which was a Rs 2,247 or 1.5% rise. Prices continued to climb into the late afternoon, touching Rupee 1,52,590 to settle nearly 1.9% higher than the previous close of Rs 1,49,753.
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Market analysts attribute this bullish turn to shifting geopolitical and macroeconomic indicators. Reports suggesting that the United States and Iran might be moving toward a de-escalation of Middle East tensions caused crude oil prices to drop and the dollar index to soften.
Typically, a weaker dollar and lower energy costs provide a tailwind for bullion, with gold acting as a standard hedge against global uncertainty. Silver's notable outperformance, however, is being driven by its dual identity; beyond being a precious metal, it remains a critical industrial component for the electric vehicle, electronics, and solar energy industries.
The heightened trading activity also provided a lift to MCX shares, which ended 2.33% higher at Rs 2,970 on the NSE.
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