Gold News & Info

Source: Marketwatch

San Francisco— Gold futures prices closed higher Thursday, mirroring strength in oil prices and gaining support from a weaker U.S. dollar to tally a two-session gain of more than $5 an ounce.

Recent "reports that some jewelry offtake had finally materialized were quick to add a few dollars to the price of gold, but such gains were offset by the apprehensions that remain in place regarding the possibility of future interest rate hikes in the U.S.," said Jon Nadler, an investment products analyst at Kitco.com.

The Fed made it clear that "despite the risk of stagnation, their principal combat target remains inflation," he said.

On Wednesday, the Fed held overnight interest rates steady at 5.25% and left the door open for further increases if inflation does not come down. This was the second-straight meeting with no change in monetary policy.

Gold for December delivery rose $2.10 to close at $588.30 an ounce on the New York Mercantile Exchange, below the day's high of $590.80. The contract, which gained $3 in Wednesday's regular session, touched a low of $582.50 earlier.

December silver futures added 10.5 cents, or 0.9%, to end at $11.245 an ounce after a low of $10.95.

Weakness in the U.S. dollar helped support precious-metals prices by Thursday afternoon. The dollar fell against major currencies on growing expectations the interest-rate differential between the U.S. and Europe will narrow this year.

Dale Doelling, chief market technician at Trends In Commodities, said it "may be weeks before we see a bottom" for gold, but "the markets will snap back in a big way and traders that get caught short when the reversal comes will get their heads lopped off if they aren't paying attention."

"So I'll remain short for now, but look for a washout to signal that a bottom has been made," he said.

Meanwhile, "the energy complex is showing some signs of strength … and the comments at the U.N. over the last 48 hours would seem to turn up the geopolitical anxiety a bit," Nell Sloane, an analyst at NSFutures.com, said in daily commentary.

Crude futures climbed as much as 1% Thursday after dropping 2% in the previous session.

"One almost comes away from the U.N. developments this week with the understanding that the 'majority' of the U.N. is against any formal action toward Iran," said Sloane. And, perhaps more importantly, "that a growing block at the U.N. will simply be against anything sponsored by the U.S."

"In short, a stalemate at the U.N. could be seen as a negative to gold," she said.

Other metals prices gained ground, with the exception of October platinum, which fell 50 cents to close at $1,139.50 an ounce, extending Wednesday's nearly $15 slide.

December copper closed up 5.55 cents at $3.4315 a pound and December palladium rose $2.65 to close at $309 an ounce.

On the supply side, gold inventories were up 36,893 troy ounces at 8.02 million troy ounces as of late Wednesday, according to Nymex data. Silver supplies fell by 447,180 troy ounces to 105.1 million and copper supplies rose by 568 short tons to 18,091 short tons.

Indexes that track shares of metals and mining companies moved higher, rebounding after total declines of around 5% in the past two sessions.

The Amex Gold Bugs Index climbed 0.5% to trade at 292.06. The Philadelphia Gold and Silver Index was at 125.11, up 0.9%, and the CBOE Gold Index climbed 0.7% to trade at 127.03.

The standouts among the individual index components included shares of Apex Silver Mines, which was up 2.6% at $14.93 and Pan American Silver, up 2.3% at $18.63.