While the S&P BSE Sensex has logged in 22.76% growth for investors, gold prices have fallen by 5% so far in 2014
Indian equities have overshadowed gold’s glitter by giving handsome returns of almost 23% to investors during the first seven months of 2014.
While the BSE’s 30-stock benchmark index S&P BSE Sensex has logged in 22.76% growth for investors so far in 2014, gold prices have fallen by 5%. Silver however, managed to generate a marginal return of 2.38%.
According to market experts, this year is proving to be good for the Indian equities, riding high on improved domestic investor sentiment and robust foreign fund inflows.
Gold and stock prices generally follow opposite trends. Gold is normally preferred as a hedge against inflation, and investors tend to park their money in bullion considering it a safer bet at times of market uncertainties.
After outperforming stock markets for more than a decade, gold has been on the back foot for more than two consecutive years now vis-a-vis equities.
Gold prices were ruling at Rs29,800 per 10 grams on 31 December 2013 and silver at Rs43,755 per kg. While gold closed Monday at Rs28,370, silver ended at Rs44,800 per kg.
On the other hand, the S&P BSE Sensex, which was at 21,170 on 31st December last year, settled at 25,991 on Monday. It recorded its all-time high level of 26,300.17 on 25th July.
Since January this year, overseas investors, major drivers of Indian equities, have made a net investment of $25.5 billion or Rs1.53 lakh crore.
Last year, the Sensex gave a positive return of about 9% to investors, while gold prices fell about 3% and silver plummeted close to 24%.
In 2012, the Sensex rose over 25%, which was nearly double the gain of about 12.95% in gold prices. The appreciation in silver was at about 12.84% in 2012.
Share, forex, money, metal, oil & oilseed markets remain closed on Tuesday for Ramzan
The BSE, National Stock Exchange, forex, money, metals and oils and oilseeds markets remain closed on Tuesday for Id-Ul-Fitr (’Ramzan Id’).
However, bullion and sugar markets were open as usual.
S&P BSE Sensex closed Monday at 25,991 (down 136 points or 0.52%), while NSE's CNX Nifty closed at 7,749 (down 42 points or 0.54%).