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Hedge funds trimmed their bullish bets in US gold futures: Nirmal Bang

SI Reporter/New Delhi 31 Jul 12 | 10:16 AM

Precious Metals

Precious metals prices traded mixed with Gold traded a little changed on Monday after a four session rally, as market players stepped back to consider the prospect of further monetary stimulus from key central-bank meetings this week. Silver prices rose on the back of bargain hunting ended about 1.5 per cent higher on major exchanges

Holdings in the SPDR Gold Trust, the world's largest gold-backed exchange traded fund, stood at 1248.61 tonnes by July 30, unchanged from the previous business day.

Holdings in the world's largest silver backed exchange-traded fund iShares Silver Trust stood at 9639.42 tonnes by July 30, remains unchanged from the previous business day.

Hedge funds and money managers trimmed their net long position or bullish bets by about 25 per cent in US gold futures and options in the week to July 24, as slumping bullion prices prompted investors to reduce their bullish bets.

The performance of gold equity funds -or funds that invest in shares of gold mining companies - has failed to live up to the expectations of investors, who desired higher returns and effective portfolio diversification. Despite firm gold prices and sterling performance by gold exchange traded funds (ETFs), actively managed gold equity funds have underperformed most fund categories by a wide margin.

Industrial Metals

Industrial metals too traded mixed with Nickel prices rose and copper prices fell as the dollar rose and as investors remained cautious ahead of a European Central Bank meeting but hopeful the bank will take action to support the region's struggling economy.

Canada's Inmet Mining Corp said on Monday that its second-quarter profit rose 74 per cent from a year earlier, helped by higher copper sales volumes. Copper production rose 54 per cent to 29,600 tonnes from 19,200 tonnes in the year earlier period.

Chile, which provides about one-third of the world's copper, produced 452,690
tonnes of the red metal in June, up 5.6 per cent from the same month a year
earlier, the government said on Monday.

The parent of China's top copper producer, Jiangxi Copper Company Ltd,
said on Monday it plans to invest in an 8 billion yuan ($1.25 billion) project to build smelting and refining capacity in Zhejiang province.

Russia's Norilsk Nickel, the world's largest nickel and palladium producer, said on Monday its nickel output declined to 69,639 tonnes in the second quarter of 2012 from 75,824 tonnes in the preceding quarter.

Japan's imports of nickel ore from Indonesia grew more than four times from a year earlier to 136,600 tonnes in June, the Ministry of Finance's monthly customs data showed on Monday.


Crude oil futures fell for the first time in five sessions yesterday on concerns that stimulus expected from the United States and Europe may fail to lift their slowing economies, overshadowing signs of lower OPEC output.

OPEC oil output fell further from its highest in four years in July as US and European sanctions cut supply from Iran to the lowest in more than two decades, a Reuters survey showed on Monday.

Japan's crude oil imports from Iran in June rose 60.5 per cent from May as refiners ramped up loadings before a halt in oil flows this month due to the imposition of sanctions on the Middle Eastern country.

Yemen delivered its first oil shipment from the Maarib pipeline to its Aden refinery after a nine-month halt that left the poorest Arab country dependent on donations of fuel, an official from the refinery told Reuters.

US crude oil imports fell slightly in May, dropping 79,000 barrels per day from a year earlier, the Energy Information Administration said on Monday.

US crude oil stockpiles likely fell last week after a pullback in imports, a preliminary Reuters poll showed on Monday.

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