He said precious metals got a “little overdone and parabolic” in the international market over the last few months. Metals — both base and precious — had surged in January as bullish Chinese investors piled into commodities amid doubts about the dollar and a shift away from currencies and sovereign bonds.
“We could possibly see some more correction. One should not indulge in bottom fishing and stay away from precious metals. I think the base metal pack like copper, zinc and aluminium will come back very strongly,” he said.
“If you have to bet anything in hard assets and metals, let it be the base metals. Proxy stocks in India will do well post the near-term correction,” he added.
His advise to investors come amid a plunge in commodity prices globally. Copper fell over 3% and aluminium and nickel 2% each on Monday as bulls in China stepped back from a tumultuous few days that have rocked global metals markets. In the last three months, copper has gained 20% and nickel 18%. Copper had spiked to a record above $14,500 just last Thursday, before plunging below $13,000 a ton on Friday and continuing its slide on Monday, according to Bloomberg.
On the precious side, gold headed for its steepest three-day drop since 1980 as a record-breaking rally unraveled at breakneck speed. Silver extended losses to 40% over the same period.
ALSO READ: Dollar Gains As Gold, Silver Slide Hurts Commodity Currencies
