Friday’s trading session turned nightmarish for precious metals enthusiasts as gold and silver prices collapsed, dragging ETFs into a freefall. Gold ETFs took a 10-12% hit across the board, while silver variants suffered up to 24% losses, amplifying the pain for retail investors.
Key performers included Nippon India ETF Gold BeES and ICICI Prudential Gold ETF at minus 10%, Axis Gold ETF down 12%, alongside Tata Gold ETF, HDFC Gold ETF, and UTI Gold ETF registering substantial drops. On the silver front, Axis Silver ETF led with a 24% plunge, ICICI Prudential Silver ETF and Kotak Silver ETF at 23%, SBI Silver ETF at 22%, and Mirai Asset, HDFC, and Nippon India Silver ETFs trailing with deep cuts.
The underlying cause was evident in spot markets: 24-carat gold declined 9,545 rupees to 1,65,795 per 10 grams per India Bullion Jewellers Association’s 5 PM update. Silver prices nosedived 40,638 rupees to 3,39,350/kg from 3,79,988/kg.
Global cues were equally bearish, with Comex gold off 3.84% at 5,150 dollars/ounce and silver down 10.56% at 102.34 dollars/ounce. Factors driving the decline include a robust US dollar index, fading safe-haven flows amid de-escalating Middle East tensions, and profit booking after multi-month highs.
This episode highlights the leveraged nature of ETFs, which amplify spot moves. Portfolio managers advise diversification, while bargain hunters eye support levels for accumulation. The road ahead hinges on central bank policies and macroeconomic releases.