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Pastimes : The Hot Button Questions:- Money, Banks, & the Economy -- Ignore unavailable to you. Want to Upgrade?

To: maceng2 who wrote (597)	3/31/2004 7:21:55 PM
From: maceng2	Read Replies (1) \| Respond to of 1417

NY gold ends at 12-week high, silver at 16-yr peak Reuters, 03.31.04, 3:32 PM ET forbes.com NEW YORK, March 31 (Reuters) - COMEX gold futures bolted to 12-week highs and silver hit a 16-year peak on Wednesday on safe-haven buying by speculators amid a tumble in the dollar and heightened global security fears. Active June gold <0#GC:> rose $5.50 to settle at $428.30 an ounce, after trading from $421.60 to $428.50, the highest since futures hit a 15-year peak in early January at $431.50. Traders said investors sought a safe-haven in hard assets, including precious metals, as the dollar fell broadly under the weight of a quickly denied rumor that U.S. Federal Reserve Chairman Alan Greenspan had suffered a heart attack, as well as news of a weaker-than-expected report on Midwest business. Jitters about recent bombings and bomb scares overseas, worries of further attacks, and continued violence in Iraq also renewed interest in gold, long seen as an alternative investment option to markets such as equities, dealers said. "You're seeing a double whammy as the dollar is continuing to fall, which naturally gives gold a bid, and also you're seeing flight-to-quality and safe-haven buying from terrorist fears," said Leonard Kaplan at Prospector Asset Management. Although trading in gold and silver was volatile, traders said investment funds are maintaining hefty long positions. "It's all about the dollar. If the dollar keeps tanking, everything is going to go up," a COMEX floor trader said. "We see a lot of funds taking profits in here, but they also want to buy the dips." The euro went as high as $1.2323 <EUR=> on Wednesday, a gain of more than 1 percent, before easing back. A lower U.S. dollar makes dollar-denominated metals cheaper to buy for traders holding foreign currencies. Estimated COMEX gold volume hit 75,000 contracts, against Tuesday's 104,095 lots. Open interest rose 970 to 295,044 lots on Tuesday, when speculators also boosted gold prices. Brokers said COMEX June gold faced first resistance at $428.50 and then at $431.50, with support at $423.80 and $417.70. Spot gold <XAU=> was last quoted at $426.25/7.00, versus a prior finish at $421.30/80. London's late fix was at $423.70. In silver, keen small speculator interest and the surge in gold sent the market to its highest since July 1988 on monthly charts. "You're seeing loads of small investors buying silver," Kaplan said, adding there had been talk among independent traders of a possible shortage of the metal -- a view generally not shared by analysts. COMEX May silver <0#SI:> jumped 17 cents to $7.945 an ounce, eclipsing the previous 16-year high set Friday at $7.81. Wednesday's range was $7.775 to $7.95, a new contract high. Spot silver <XAG=> rose to $7.93/95, from $7.74/76 previously. The fix was at $7.825, a peak since 1998. NYMEX July platinum <0#PL:> shot back above $900 again, gaining $11.80 to $900.20 an ounce. Spot <XPT=> last was worth $901.00/906.00. June palladium <0#PA:> rose 85 cents to $289.95 an ounce. Spot palladium <XPD=> was at $283.50/289.50. Copyright 2004, Reuters News Service