Gold drifts in quiet trade amid weak demand; silver tumbles

Gold prices fell back after a brief overnight rebound on the first trading day of 2015 at the domestic bullion market due to reduced stockists offtake as well as lack of local buying interest. Elsewhere, silver plunged sharply and closed below the key Rs 37,000-mark on the back of heavy speculative unwinding.

Trading sentiments were also largely affected in the absence of any directional cues from the global markets in view of New Year holiday. Standard gold (99.5 purity) dropped by Rs 80 to finish at Rs 26,640 per 10 grams from Wednesday's level of Rs 26,720.

Pure gold (99.9 purity) also fell by a similar margin to end at Rs 26,790 per 10 grams compared to Rs 26,870. Silver (.999 fineness) tumbled by Rs 460 to settle at Rs 36,735 per kg as against Rs 37,195 yesterday.

In worldwide trade, the shiny metal closed below the significant US$1,200-level in overnight Comex trade following funds selling amid investors' caution.