AGL 38.20 Increased By ▲ 0.05 (0.13%)
AIRLINK 129.30 Increased By ▲ 4.23 (3.38%)
BOP 7.85 Increased By ▲ 1.00 (14.6%)
CNERGY 4.66 Increased By ▲ 0.21 (4.72%)
DCL 8.35 Increased By ▲ 0.44 (5.56%)
DFML 38.86 Increased By ▲ 1.52 (4.07%)
DGKC 82.20 Increased By ▲ 4.43 (5.7%)
FCCL 33.64 Increased By ▲ 3.06 (10.01%)
FFBL 75.75 Increased By ▲ 6.89 (10.01%)
FFL 12.83 Increased By ▲ 0.97 (8.18%)
HUBC 110.72 Increased By ▲ 6.22 (5.95%)
HUMNL 14.03 Increased By ▲ 0.54 (4%)
KEL 5.22 Increased By ▲ 0.57 (12.26%)
KOSM 7.69 Increased By ▲ 0.52 (7.25%)
MLCF 40.08 Increased By ▲ 3.64 (9.99%)
NBP 72.51 Increased By ▲ 6.59 (10%)
OGDC 189.18 Increased By ▲ 9.65 (5.38%)
PAEL 25.74 Increased By ▲ 1.31 (5.36%)
PIBTL 7.38 Increased By ▲ 0.23 (3.22%)
PPL 153.45 Increased By ▲ 9.75 (6.78%)
PRL 25.52 Increased By ▲ 1.20 (4.93%)
PTC 17.92 Increased By ▲ 1.52 (9.27%)
SEARL 82.50 Increased By ▲ 3.93 (5%)
TELE 7.63 Increased By ▲ 0.41 (5.68%)
TOMCL 32.50 Increased By ▲ 0.53 (1.66%)
TPLP 8.48 Increased By ▲ 0.35 (4.31%)
TREET 16.74 Increased By ▲ 0.61 (3.78%)
TRG 56.01 Increased By ▲ 1.35 (2.47%)
UNITY 28.85 Increased By ▲ 1.35 (4.91%)
WTL 1.34 Increased By ▲ 0.05 (3.88%)
BR100 10,659 Increased By 569.2 (5.64%)
BR30 31,331 Increased By 1822.5 (6.18%)
KSE100 99,269 Increased By 4695.1 (4.96%)
KSE30 31,032 Increased By 1587.6 (5.39%)

Gold rose on Friday, reversing sharp initial losses as uncertainty over an upcoming rescue plan for Spain's troubled banks encouraged some safe-haven buying and prompted investors to cover their bearish bets ahead of the weekend. The metal rebounded $30 from its early lows after sources told Reuters Spain is expected to request European aid for its ailing banks at the weekend to forestall worsening market turmoil. Friday marked the third consecutive session gold has moved in a $30 range, or wider.
"There is a tremendous amount of fear going into the weekend as to what's going to happen with the bailout on Spanish banks. That is driving people into a safe haven, which gold represents," said Jeffrey Sica, chief investment officer at SICA Wealth Management LLC, which has $1 billion in assets. "Gold is trading so volatile that smaller moves could be very much exaggerated just based on momentum. We could see it plunge or surge at any given moment," Sica said.
The metal's turnaround was particularly impressive in the face of losses in industrial commodities led by copper and a higher dollar. The inverse correlation between gold and the US dollar fell to its weakest in about six months. Bullion still ended lower for the week, with investors frustrated after Federal Reserve Chairman Ben Bernanke at a Congressional testimony Thursday failed to hint at a hoped-for renewal of monetary stimulus. The metal staged a 4.3 percent rally last Friday on expectations for further easing after last Friday's dismal US jobs report.
Spot gold was up 0.2 percent at $1,592.44 an ounce by 3:10 pm EDT (1910 GMT), rebounding sharply from a one-week low of $1,561.44 earlier in the session. US gold futures for August delivery settled up $3.40 at $1,591.40 an ounce, with trading volume at about 30 percent below its 30-day average, preliminary Reuters data showed. The metal lost 2 percent for the week for its biggest one-week loss in four weeks.
From a long-term chart perspective, gold still held its three-year upward trendline. However, the metal could face technical resistance between $1,620 and $1,650 an ounce after a sharp pullback late in the week, said Mark Arbeter, chief technical strategist of S&P Capital IQ. Gold is one of the few commodities on Friday that defied a sharp rise in the dollar index after Spain's credit was lowered by Fitch ratings.
The 25-day correlation-log between bullion and the dollar was at -0.24, the weakest negative correlation since October 2011. Traders said that a record low in US Treasury bond yields earlier this week prompted some investors to favour higher-yield bluechip equities at the expense of gold. US equities measured by the S&P 500 index posted a near 4 percent weekly rise for its biggest gain of the year. Among other precious metals, spot silver fell about 0.1 percent to $28.55 an ounce. Spot platinum eased 0.3 percent to $1,429.74 an ounce, and spot palladium dropped 1.3 percent to $610.25 an ounce.

Copyright Reuters, 2012

Comments

Comments are closed.