Modi's Gold Buying Appeal Sends Jewellery Stocks Plummeting

Prime Minister Narendra Modi's appeal for restraint on gold buying has sent jewellery stocks plummeting. In an Instagram post, he urged citizens to follow the 'Swadeshi' and 'Vocal for Local' mantra, which markets interpreted as potentially dampening near-term gold jewellery demand.

Jewellery stocks today fell up to 2.25% with Titan, Kalyan Jewellers, and Thangamayil declining sharply. This is not the first time such a call has weighed on jewellery stocks, with investors reading repeated government messaging around gold consumption as a potential headwind for near-term demand.

While government appeals have had limited lasting impact in the past, they can still influence sentiment around gold purchases, especially during peak buying periods. The timing of this appeal is also notable given volatile gold prices and the upcoming festive season.