Monday , November 20 2017
Home / Agri News / US MIDDAY: gold recovers

US MIDDAY: gold recovers




  • Gold recovered almost 2 percent early on Tuesday after buyers of physical bullion jumped in at cheaper prices following Monday’s historic plummet, but the market had trouble sustaining gains and there was little confidence that gold was out of the woods. 

    Gold extended its decline to a two-year low overnight before steadying. The metal’s historic sell-off in the last two sessions prompted investors to assess the damage to bullion’s status as a hedge against inflation and currency depreciation. There were signs of small pick-up in physical demand from India, historically the world’s largest bullion consumers. In addition, US coin demand also rebounded as retail investors bought at lower prices. 

    Bullion on Monday shed 8.5 percent and recorded its biggest ever daily fall in dollar terms – at one point it was down $142 an ounce – catching gold bulls, speculators and veteran investors by surprise. “I’m selling into the rally and waiting to figure out what’s going on,” said Charles Gradante, co-founder of The Hennessy Group, which invests in hedge funds. 

    “The question is where’s gold going from here. Now this could be a dead-cat bounce we’re getting today,” Gradante said. Spot gold bottomed at $1,321.35 overnight, the lowest price since January 28, 2011. It fetched $1.373.80 an ounce by 2:42 p.m. EST (1842 GMT), up 1.6 percent from Monday’s close. Gold has fallen almost 20 percent so far this year after an unbroken 12 years of gains and is some 28 percent down from the record high hit in September 2011 at $1,920.30. 

    US Comex gold futures for June delivery settled up $26.30 at $1,387.40 an ounce. Trading volume was strong but well off an all-time high over 700,000 lots on Monday. Turnover as of early Tuesday afternoon was 433,000 contracts, more than doubled its 30-day average of 190,000, preliminary Reuters data showed. 

    Tuesday’s rally largely ignored a call by Goldman Sachs to sell gold and buy natural gas after bullion’s steep decline because of “a more confident economic environment.” Physical dealers saw inquiries from jewellers following the latest sell-off, but there were no signs of buying related to tensions between the two Koreas or bombings in Boston on Monday, which killed three people. 

    Traders cited liquidation by prominent hedge funds in gold ETFs. Prominent hedge fund managers John Paulson told clients earlier this month his gold fund suffered double-digit losses in the first quarter, while David Einhorn’s dedicated gold fund lost 28 percent during the same period. Among other precious metals, silver rallied 3.8 percent to $23.43. Platinum group metals also rebound after heavy losses on Monday, with platinum up 3 percent at $1,443.74 an ounce and palladium at $675.75, up 3.6 percent. 

    Copyright Reuters, 2013

    About admin

    Check Also

    OVERCOMING A MENTAL ROADBLOCK FOR USING PLANT BREEDING SOFTWARE

    Report Issue: * Suggest Edit Copyright Infringment Claim Article Invalid Contents Broken Links Your Name: …

    Leave a Reply

    Be the First to Comment!

    Notify of
    avatar
    wpDiscuz