Gold and silver exchange-traded funds (ETFs) rallied as much as 4% on Monday after an announced peace framework between the US and Iran boosted sentiment across precious metals, helping bullion prices rebound sharply from last week's correction.
Silver ETFs led the gains, with Tata Silver ETF and Kotak Silver ETF rising up to 4%. Nippon India Silver ETF advanced 3.7%, while HDFC Silver ETF and DSP Silver ETF gained 3.68% and 3.9%, respectively. Bandhan Silver ETF, Edelweiss Silver ETF, Axis Silver ETF and UTI Silver ETF also climbed as much as 4%.
Gold ETFs tracked the broader rally in bullion. Tata Gold ETF gained up to 2%, while Nippon India ETF Gold BeES rose 1.75%. ICICI Prudential Gold ETF advanced 1.82% and SBI Gold ETF added 1.7%.
The gains came alongside a sharp recovery in precious metal futures. On the Multi Commodity Exchange (MCX), August gold contracts were up Rs 2,777, or 1.84%, while silver futures surged Rs 6,614, or 2.69%, as of 3:48 p.m. IST. Earlier in the session, gold futures had risen Rs 2,242, or 1.49%, to Rs 1,52,770 per 10 grams on a turnover of 8,948 lots.
The rebound follows a steep correction last week, when gold futures declined Rs 5,066, or 3.2%, to settle near Rs 1.50 lakh per 10 grams.
Analysts attributed the recovery to easing geopolitical tensions and supportive macroeconomic conditions.
In international markets, COMEX gold futures for August delivery climbed 2.81% to $4,358 an ounce as of 6:11 a.m. EDT (3:41 p.m. IST), gaining $119.20 during the session. The move was supported by a weaker US dollar and softer Treasury yields.
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Investor sentiment improved after US and Iranian officials announced an interim peace framework aimed at halting hostilities and reopening the Strait of Hormuz. In a post on Truth Social, US President Donald Trump said, "The deal with the Islamic Republic of Iran is now complete," adding that he had authorised the reopening of the Strait of Hormuz and the immediate removal of the US naval blockade.
Despite Monday's rally, analysts cautioned that uncertainty remains as several key aspects of the proposed agreement, particularly those concerning Iran's nuclear programme, have yet to be resolved.
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