US gold futures ended on Thursday with healthy gains after several sessions of lower closes brought buyers back in to buy the lows, inspired by a rebound in US stock prices, traders said.
Volumes were thin, however, with many players still cautious after several recent volatile sessions that tracked swings in oil and share prices, traders said. "A lot of the buying started on Wednesday afternoon with some ETF (exchange-traded fund) buying. Then, overnight in Asia, there was only light buying with a small range. (Gold) held on to the gains in New York with higher stock prices giving it a boost," said one New York gold dealer.
Benchmark gold futures for April delivery on the Comex division of the New York Mercantile Exchange finished $4.60 higher at $647.10 an ounce, after moving as high as $651.30 from a low at $645.0 an ounce.
Comex estimated final volume at paltry 10,000 lots. Some traders said some light short-cover buying and fund interest re-emerged at the eight-day low hit on Wednesday. "The feeling now is that the stock market's fear of a liquidity crunch from supreme loans was probably a little overblown," said Steve Platt, analyst at Archer Financials. US stock indexes firmed amid enthusiasm over a bid to buy the Chicago Board of Trade. They also gained as financial shares recovered from recent losses sustained on fears that foreclosures in the supreme US mortgage loan sector would spread and jeopardise US economic growth.
Concerns about the economy of top energy consumer, the United States, also hurt crude oil prices in the week, but oil managed to claw back for much of Thursday's session. US crude oil futures ended lower, however, paring gold's gains in after-hours trade.
Oil futures were pressured late in the day by a sharp decline in gasoline futures, which fell prey to profit-takers at the highs. At the start, an unexpected jump in the US producer price index for February sent some buyers into the gold market seeking an inflation hedge. In a Reuters survey, the US PPI was forecast to rise by 0.5 percent. Instead, it jumped 1.3 percent last month, compared with a 0.60 percent decline in January.
Spot gold rose to $646.40/7.40 an ounce, up from late on Wednesday's quote of $643.00/3.75 an ounce. London's late afternoon gold fix stood at $648.50. Comex may silver finished 24.50 cents higher at $13.0750 an ounce. Spot silver was quoted at $12.97/3.02 an ounce in late on Thursday dealings, up from $12.76/2.81 late on Wednesday.
The London silver fix was $12.90. Nymex April platinum closed $14.70 higher to settle at $1,215.70 an ounce. Spot platinum stood at $1,213.00/17.00 an ounce. June palladium lost $1.80 to end at $351.70 an ounce. Spot palladium was quoted down at $349.00/54.00 an ounce.
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