It is the time of the year when the gems and jewellery sector works overtime to meet the festive demand. Gold prices are at a six-year high in the Indian markets, but experts believe that this might act as a deterrent for the buyers.
Over the last two years, the government policy framework has meant that the trade has also shifted from the unorganised sector to the organised sector.
Meanwhile, the drought-like situation in five states, has hit the rural demand. When it comes to gems and precious stones, both diamond jewellery and platinum demand has been robust. When it comes to crude oil prices from last Diwali, Brent price have gone up by 18 percent while Nymex is up by 14 percent.
Although when it comes to metals, with only steel giving positive returns since last Diwali, lead and zinc saw the largest decline, both falling 20 percent each.
In an interview to CNBC-TV18, Kunal Shah, head - commodities at Nirmal Bang Commodities, Renisha Chainani, head - commodities at Monarch Networth Capital, Naveen Mathur, director - commodities at Anand Rathi, and Prathamesh Mallya, chief analyst-commodities at Angel Commodities Broking shared their views on the current trends in commodities markets and the road ahead.
On precious metals, Chainani said silver was expected to outperform gold this year, but as base metals have not performed, it did not give support to the silver prices and they have been trading lackluster from many months.
"However, from last one month the movement has gathered up and we are finally seeing some bullishness coming in gold and silver prices,” he said.
On gold prices, Mallya said, “As far as gold goes for Indian consumers, it is not about prices. It is mainly for consumption. So from a returns perspective per se, I would not look at it. However, from an international perspective, I think 8-10 percent possibility is there if you look from 8-12 months perspective.”
An era of rising interest rates does not favour gold prices, Mallya said.
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