While a temporary pause on targeting energy infrastructure until April 6 provided limited relief, the absence of a clear resolution continues to weigh on sentiment and cap upside in bullion
Silver exchange-traded funds (ETFs) were under selling pressure on March 27, slipping up to about 4 percent even as futures on the Multi Commodity Exchange of India (MCX) stayed firm At around 1 pm, MCX silver was up roughly 2.75 percent, trading near Rs 2.26 lakh a kg, creating a disconnect that investors should note between spot-linked ETF prices and futures movement.
Among the major laggards, Groww Silver ETF dropped 4.04 percent to Rs 21.83. HDFC Silver ETF was down 4 percent at Rs 212.76, while DSP Silver ETF declined 3.96 percent to Rs 214.25. Kotak Silver ETF slipped 3.75 percent to Rs 21.58 and Edelweiss Silver ETF 3.66 percent to Rs 222.51.
The broad-based decline suggests short-term profit booking and price adjustment in ETFs despite earlier strength in futures, a pattern often seen during volatile sessions.
Top gold ETFs also reflected weakness across the segment. Among the key names, Nippon India ETF Gold BeES, ICICI Prudential Gold ETF, and Axis Gold ETF all declined around a percent. Nippon India ETF Gold BeES slipped about 0.92 percent to Rs 118.19, ICICI Prudential Gold ETF 1.04 percent to Rs 122.21 and Axis Gold ETF dropped about 1.05 percent to Rs 118.90, even as MCX gold futures remained in the green.
Gold traded higher on MCX. The prices were up about 1.97 percent, gaining Rs 2,806 to trade at around Rs 1.43 lakh for 10 grams. It hit an intraday high of Rs 1.46 lakh.
“Gold and silver have retreated as geopolitical tensions intensified after US President Donald Trump warned of stronger military action against Iran following the rejection of peace talks. While a temporary pause on targeting energy infrastructure until April 6 provided limited relief, the absence of a clear resolution continues to weigh on sentiment and cap upside in bullion,” Dr Renisha Chainani, head-research at Augmont, said.
Is this a buying opportunity?
Market experts say the dip in ETFs may not necessarily reflect a change in the underlying fundamentals of precious metals but rather short-term pricing mismatches and investor sentiment.
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According to experts, the overall Iran war situation is unclear. Rising tensions may push inflation up and slow down the US economy, so gold will gets some support but it also faces pressure from high interest rates and cautious policies.
Thomas Stephen, Director and Head- Preferred, Anand Rathi Shares and Stock Brokers, said, “The silver ETF prices are live just like for equity shares. We are of the belief that when investing into Silver ETFs, one should have a structural view on it before taking the plunge. If one is thinking truly long term and the investor is looking at these avenues from a purely diversification perspective, then it is fine to buy at dips. The allocation towards precious metals should ideally not exceed more than 5-10 percent of your overall portfolio.”
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