US gold futures ended 1.5 percent higher on Thursday as a closely watched credit downgrade of US conglomerate General Electric heightened economic fears, triggering investment inflows to the gold market. Gold for April delivery settled up $13.30, or 1.5 percent, at $924.00 an ounce on the COMEX division of the New York Mercantile Exchange.
GOLD: Ranged between $906.30 and $931.60. Gold favoured after Standard & Poors stripped General Electric Co of its top-tier AAA credit rating, cutting the grade by one notch to AA-plus. GE shares, however, rallied 15 percent after S&P gave the US conglomerate a stable outlook.
Wall Street had been expecting a negative credit outlook. Bullion closed below its session highs as Wall Street rallied on comments by Bank of America CEO Kenneth Lewis who said he was confident his bank would pass the US governments stress test. Gold supported by the notion that the recent stock market rally may only be a bear market bounce - Frank McGhee, head precious metals trader of Integrated Brokerage Services.
Momentum positive as after the worlds largest gold-backed exchange-traded fund, the SPDR Gold Trust, said holdings hit a record 1,038.17 tonnes as of March 11, up 9.18 tonnes from the previous day. The CEO of Newmont, the worlds No 2 gold producer, told the Reuters Global Mining and Steel Summit in New York that he would be surprised to see gold on average below $900 this year.
The gold-oil ratio was at 19.93 on Thursday, compared with 21.06 the previous session. COMEX estimated midday volume at 142,123 lots and options turnover of 13,955 contracts. Spot gold was at $920.80 an ounce at 1:45 pm EDT (1745 GMT), up 1.6 percent from its last quote in New York late Wednesday.
SILVER: COMEX May silver ended up 14.3 cents, or 1.1 percent, at $12.943 an ounce, following golds bounce. Ranged $12.64 to $13.08.
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