AGL 37.75 Decreased By ▼ -0.40 (-1.05%)
AIRLINK 129.25 Increased By ▲ 4.18 (3.34%)
BOP 7.46 Increased By ▲ 0.61 (8.91%)
CNERGY 4.61 Increased By ▲ 0.16 (3.6%)
DCL 8.45 Increased By ▲ 0.54 (6.83%)
DFML 38.70 Increased By ▲ 1.36 (3.64%)
DGKC 81.28 Increased By ▲ 3.51 (4.51%)
FCCL 32.59 Increased By ▲ 2.01 (6.57%)
FFBL 75.00 Increased By ▲ 6.14 (8.92%)
FFL 12.35 Increased By ▲ 0.49 (4.13%)
HUBC 108.90 Increased By ▲ 4.40 (4.21%)
HUMNL 13.99 Increased By ▲ 0.50 (3.71%)
KEL 5.03 Increased By ▲ 0.38 (8.17%)
KOSM 7.60 Increased By ▲ 0.43 (6%)
MLCF 38.30 Increased By ▲ 1.86 (5.1%)
NBP 72.30 Increased By ▲ 6.38 (9.68%)
OGDC 187.00 Increased By ▲ 7.47 (4.16%)
PAEL 25.28 Increased By ▲ 0.85 (3.48%)
PIBTL 7.29 Increased By ▲ 0.14 (1.96%)
PPL 150.99 Increased By ▲ 7.29 (5.07%)
PRL 25.35 Increased By ▲ 1.03 (4.24%)
PTC 17.30 Increased By ▲ 0.90 (5.49%)
SEARL 82.20 Increased By ▲ 3.63 (4.62%)
TELE 7.56 Increased By ▲ 0.34 (4.71%)
TOMCL 32.62 Increased By ▲ 0.65 (2.03%)
TPLP 8.49 Increased By ▲ 0.36 (4.43%)
TREET 16.44 Increased By ▲ 0.31 (1.92%)
TRG 56.45 Increased By ▲ 1.79 (3.27%)
UNITY 28.40 Increased By ▲ 0.90 (3.27%)
WTL 1.33 Increased By ▲ 0.04 (3.1%)
BR100 10,554 Increased By 464.7 (4.61%)
BR30 30,982 Increased By 1473.1 (4.99%)
KSE100 98,340 Increased By 3766 (3.98%)
KSE30 30,674 Increased By 1229.7 (4.18%)

Gold prices rose towards $1,625 an ounce on Wednesday, its highest in the week to date, as weaker than expected US retail sales data knocked the dollar, keeping market confidence intact after bullion's move above $1,600 in the previous session. Spot gold rallied to a session high of $1,624.36, before settling back a touch to $1,620.30 by 1450 GMT. US gold futures for August delivery gained $8.00 to $1,620.80.
US retail sales fell for a second straight month in May. Excluding autos, sales showed their biggest decline in two years. At the same time, concerns about Spain and Italy's debt and uncertainty ahead of Sunday's Greek election kept the euro zone's problems on the boil.
While gold has failed to react positively to elevated risk in the euro zone, signs that economic jitters are spreading from Europe to the United States were proving supportive to prices. The metal rallied on June 1 as poor US jobs data reignited expectations for another round of US quantitative easing (QE), which could undermine the dollar and boost interest in gold as an alternative to volatile currencies.
"People are clearly betting that Bernanke may warm towards more QE and implement QE3. It's a realistic possibility, maybe what they will do is indicated that the bias has shifted towards doing some QE...that will be enough to put a floor under the gold price," SocGen analyst Robin Bhar said.
In other markets, global stocks fell after the US data, while German Bund futures erased some early losses and Italian bonds came under pressure before Thursday's crucial bond auction. "So far the financial aid promised to Spanish banks has failed to have its desired effect. On the contrary, the sell-off of Spanish and indeed Italian government bonds continues," Commerzbank said in a note.
"The sovereign debt crisis can be expected to keep the markets on tenterhooks for quite some time yet and cause demand for gold to pick up again - not only among retail investors." From a chart perspective, gold is currently holding near its 50-day moving average at $1,613.07. Technical analysts identify the $1,640 an ounce area as the next big level to break for gold.
"Only a break above the current June high at 1641 will (put) the 50 percent Fibonacci retracement of this year's decline at 1659.07 and the May high at 1672.10 in (gold's) sights," Commerzbank said in a note. "Below here, the outlook will stay neutral." Kazakhstan, which last week said it planned to boost its gold reserves to 15 percent of its total gold/foreign exchange holdings, has now announced it will raise that proportion to 20 pct through the acquisition of 20 tonnes of gold from the Kazzinc mining corporation and a further 4.5 tonnes from Kazakhmys.
Kazakhstan is one of a number of countries, including Russia, Mexico, Colombia and South Korea, that have built up their official gold holdings in recent years. Most buying has been seen from Asian and emerging market central banks. Among other precious metals, silver rose a modest 0.3 percent to $20.08 an ounce, tracking gains in gold. Spot platinum gained 1 percent to $1,465.74 an ounce, while palladium added 0.4 percent at $622.75 an ounce.

Copyright Reuters, 2012

Comments

Comments are closed.