Gold Settles Near $1,200 on Safe-Haven Demand, Vietnam Gold Market News
Gold prices rose above $1,200 an ounce Tuesday as persistent worries in the wider financial markets over sovereign debt brought in some safe-haven demand for the precious metal.
Platinum and palladium fell Tuesday, resuming last weeks slide, as investors took fright at a further drop in the euro and equity markets, and industrial end-users held out for lower prices.
Spot gold [GCC1 1197.8 --- UNCH (0) ] was bid at around $1,196 an ounce, against $1,190.05 late in New York on Monday, having earlier hit a session high of $1,200.05.
Platinum fell around 3 percent to a low of $1,478.25 and was later at $1,492.75 an ounce against $1,526.50. Palladium was at $432.75 against $444.50, having hit a session low of $420.88, down 5.3 percent.
Platinum slid 12.3 percent last week and palladium 17.2 percent, its worst weekly loss since 2003, as a bout of fund selling early in the week sparked sharper losses in the metals.
Both metals hit their lowest since February this year.
While interest by industrial users lifted prices in the last two sessions, caution towards the metals has reemerged as a 1 percent drop in the euro and weak stocks undermined commodities.
"As far as industry is concerned, it is a lot quieter today, which is probably why we have come off again," said Wolfgang Wrzesniok-Rossbach, head of sales at Heraeus.
"It looks like people are still unsure about what the investors are doing," he said. "If ETF holders should start to liquidate some of their positions because they need cash, (the correction) might not be over yet."
The euro fell more than 1 percent to a near four-year low against the dollar amid concerns about the euro zones banking system after the Spanish central banks takeover of savings bank CajaSur on Saturday.
European shares also extended losses to their lowest in nine months, while U.S. stocks tumbled at the open on Tuesday, on worries over Europes banking sector and tensions on the Korean peninsula.
U.S. gold futures for June delivery on the Comex division of the New York Mercantile Exchange rose $4 to settle at $1,198 an ounce.
"People are going long again with equities that continue to slide. All equities are bearish at the moment ... its probably going to get worse before it gets better," said Standard Bank analyst Walter de Wet.
"If gold goes below $1,180 its definitely a good buy. We think its going to head higher and end the year above $1,300."
Among other commodities, oil fell below $68 a barrel on fears Europes debt crisis would derail the global economic recovery. Industrial metals like copper and aluminum also fell.
Haven From Risk
While other assets are suffering from such concerns, gold is taking support from demand for the metal as a haven from risk.
The worlds largest gold-backed exchange-traded fund, New Yorks SPDR Gold Trust [GLD 117.36 0.52 (+0.45%) ], said its holdings rose more than 16 tons to a record 1,236.889 tons as of May 24.
"Global (ETF) holdings have grown by 3.63 million ounces so far this month, by far the largest monthly increase this year," said UBS analyst Edel Tully in a note.
"With four US trading days remaining in the month, its very probable that Mays ETF demand will outpace that of last October."
A Reuters poll of analysts, traders and fund managers found on Tuesday the majority expect gold to resume its uptrend, with 21 out of 26 respondents predicting the metal will end the year at record levels.
Silver was bid at $17.65 an ounce [SIC1 17.763 --- UNCH (0) ] versus $17.82
Vietnam Business And Financial News Network. Source [stox.vn]
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