Gold futures near three-week high
By Myra P. Saefong, CBS.MarketWatch.com
Last Update: 10:14 AM ET April 21, 2003
NEW YORK (CBS.MW) -- Gold futures gained as much as $5 an ounce early Monday to top $332 for the first time in nearly three weeks on speculation that the weak economy will continue to hit the U.S. dollar, making gold an attractive alternative.
On a technical basis, gold looks poised to move up to $335, Josh Sadler, vice president at the energy trading desk of Societe General in New York told clients Monday. He expects that target would be supported by "a weaker dollar and stock market after the euphoria of the quick victory in Iraq wears off."
Looking ahead, the only potential bearish news he sees for gold prices is speculation that Iraq has $1 billion worth of gold (roughly 10 tons), that "could see its way into the system to help in the reconstruction and humanitarian efforts."
Gold for June delivery, after trading as high as $332.70 an ounce, stood lately at $330.30 an ounce, up $2.70. The contract hasn't seen these levels since April 1.
Gold dealers will be encouraged by gold's resilience in the face reduced tensions in the Middle Easte and its ability to hold above $320, analysts at the Standard Bank in London wrote.
Against this backdrop Monday, most major U.S. stocks traded higher amid upbeat first-quarter results. See Market Snapshot.
And the dollar strengthened against most foreign currencies -- limited some of gold's gains. The value of the greenback is crucial to foreign investors who must exchange their currencies to buy the dollar-denominated precious metal.
Palladium, platinum higher
Among other metals futures, the June palladium contract traded at $157 an ounce, up $44.25. July platinum rose to $628.50 an ounce, up $3.80. The metals posted gains of more than $4 an ounce on Thursday, but have generally been on the declines for several weeks.
Still, "oversupply, a lack of any real demand and persistent selling suggest further weakness with $120 on the radar screen," said analysts at the Standard Bank.
Elsewhere, the May contract for silver traded at $4.485 an ounce, up 1.5 cents from the previous session. May copper traded at 72.85 cents a pound, down 0.9 cent from the previous session.
As for supplies, Nymex gold inventories were up 17,975 at 2.40 million troy ounces late Thursday.
Silver inventories were down 237,248 troy ounces at 108 million troy ounces, while copper stocks fell 497 short tons to 356,457 short tons.
Metals shares climb
Metals-related equities moved higher Monday, with both gold futures prices and the broader market providing support.
Tracking the sector as a whole, the Philadelphia Gold & Silver Index ($XAU: news, chart, profile) rose 0.7 percent to 67.51 and the Amex Gold Bugs Index (HUI: news, chart, profile) added 0.9 percent to 127.91. The CBOE Gold Index ($GOX: news, chart, profile) climbed by 0.8 percent to 55.19.
Index component Meridian Gold (MDG: news, chart, profile) tacked on 8 cents to $10.47, Newmont Mining (NEM: news, chart, profile) rose 3 cents to $26.97 and Placer Dome (PDG: news, chart, profile) climbed by 9 cents to $10.08. Freeport (FCX: news, chart, profile) also rose 23 cents to $18.40.
Elsewhere, Stillwater Mining (SWC: news, chart, profile), a major platinum and palladium producer, gained 4 cents to stand at $2.43, while Inco Ltd. (N: news, chart, profile) fell by a penny to $19.69.
Myra P. Saefong is a reporter for CBS.Market |
