Gold futures experienced significant volatility on Tuesday, with prices retreating by ₹1,107 to ₹1.57 lakh per 10 grams in futures trade. According to reports from The Hindu BusinessLine, the June delivery contract on the Multi-Commodity Exchange rose by ₹1,107, or 0.7 per cent, to ₹1,57,974 per 10 grams in a business turnover of 4,725 lots. The August contract also traded lower, declining by ₹1,061, or 0.65 per cent, to ₹1,61,320 per 10 grams in 4,810 lots on the MCX.
The price decline was primarily attributed to renewed US military strikes against Iranian targets, which revived fears of a prolonged conflict in West Asia. As reported by The Hindu BusinessLine, analysts noted that optimism around possible US-Iran peace negotiations had initially supported sentiment before renewed uncertainty sparked fresh selling. Manav Modi, Commodities Analyst at Motilal Oswal Financial Services Ltd, explained that the renewed escalation pushed crude oil prices higher after a week of declines, reigniting concerns over energy-driven inflation and keeping markets cautious. The latest developments show that Brent crude climbed 2.93% to $98.96 per barrel, with US President Donald Trump stating that negotiations with Iran to end the war were progressing "nicely," though officials noted a final decision may take time due to Tehran's complex communication networks.
The US dollar remained relatively firm as investors continued to view the greenback as a safer asset amid geopolitical uncertainty. According to reports from The Hindu BusinessLine, a rebound in oil prices supported the US dollar, contributing to the pressure on gold prices. In international markets, Comex gold futures for August delivery went up marginally to $4,562.15 per ounce in New York, showing mixed global sentiment toward the precious metal. The rupee's brief appreciation was reversed following the oil price spike and geopolitical tensions.
The geopolitical tensions extended beyond precious metals to impact broader markets, with Sensex falling 479 points (0.63%) to 76,009 and Nifty dropping 118 points (0.49%) to 23,913 in volatile trading. As per Outlook Business, major losers included Bharti Airtel, TCS, and HDFC Bank, while Tech Mahindra, Maruti, and Adani Ports emerged as winners. Foreign Institutional Investors (FIIs) bought equities worth ₹822 crore on Monday, according to exchange data. Market analysts noted that for an oil-import-dependent economy like India, rising crude prices immediately revive concerns around imported inflation, currency pressure, and widening fiscal stress.
