Full story
European gold bumps range roof,
palladium firms
12:11 p.m. Nov 18, 1998 Eastern
LONDON, Nov 18 (Reuters) - Gold rose more than
$2.00 to the ceiling of its recent range during late
European trade on Wednesday, nudging above
$297.00 on buying dealers attributed variously to
funds, options writers and others.
London gold fixed at $296.50 a troy ounce in the
afternoon, up on the morning's $294.40.
Also boosting sentiment were World Gold Council
figures showing improving demand in the third quarter
and the European Parliament's call for gold euros to
be struck to mark the single currency launch.
One London dealer cited stop-loss buying as the
main spur for gold's move, a factor he said pushed
prices sharply higher once they exceeded $295.00.
''I think there was a bit of fund buying on the floor
which triggered the stop losses after that,'' he said.
A second dealer agreed on the stop loss effect but
put the initial rise down to strength in the Australian
dollar prompting options writers to buy gold to cut
their exposure to the market.
Options holders secure the right, but not the
obligation, to buy or sell gold at an agreed future date
and price by paying a premium to options grantors.
Australian dollar strength is relevant as that country is
a major gold producer with miners who are typically
very active in currency and spot price hedge markets.
One dealer played down the significance of
Wednesday's gain, pointing out that prices remained
in the $10 band they had been in since October 20.
Spot gold was last at $296.90/$297.40, $2.90 up on
New York's previous close, while spot silver was up
six cents in sympathy at $4.98/$5.01.
Gold demand in 25 key markets monitored by the
World Gold Council reached 1,712.2 tonnes in the
first three quarters of 1998, a decline of 20 pct from
the same period last year, the industry body said in a
quarterly report.
But third quarter demand had recovered to be just
one percent below the same period in 1997, it
added.
Palladium took a hike North when New York
opened, jumping $9.00 to $288.00 before the
afternoon fix on what one dealer suggested was a
delayed reaction to Tuesday's bullish demand news
from refiner Johnson Matthey.
It was last at $286.00/$291.00, $8.00 up on
Tuesday's New York close, while platinum was at
$351.00/$353.00, more than $4.00 higher.
((Patrick Chalmers, London Newsroom +44 171
542 8057. london.commodities.desk+reuters.com))
Copyright 1998 Reuters Limited |
