Gold Keeps Six-Week High as Dollar Weakens, Silver Rises

by on July 23, 2009 · 0 comments

Thursday was a day of multi-week highs for select commodities and stocks. Gold improved on Wednesday’s six-week high as the U.S. dollar gave ground and oil prices shot up to a three-week high. Silver and platinum advanced modestly. U.S. stocks rallied with the Dow moving above 9,000 to mark an eight-month high.

Bullion update ...In New York trading futures for bullion:

  • Silver for September delivery rose 7 cents, or 0.5 percent, to 13.77 an ounce.

  • Gold for August delivery gained $1.50, or 0.2 percent, to $954.80 an ounce — the highest level since June 11.

  • October platinum climbed $2.70, or 0.2 percent, to $1,178.40 an ounce.

Notable precious metal quotes of the day follow:


"Dollar weakness is keeping [gold] higher," Pradeep Unni, senior analyst at Richcomm Global Services, was quoted on Reuters.. "Almost all the recent momentum has come on the back of dollar weakness."

"There are good reasons to believe the dollar should weaken, and in that case, gold will be a beneficiary, but it’s not necessarily going to occur overnight," Patrick Chidley, an analyst at Barnard Jacobs Mellet LLC, was quoted on Bloomberg.

"We have a tug of war here between those who dare to buy at these levels and people who got in at previous levels," Jon Nadler, senior analyst, Kitco Metals Inc, was quoted on MarketWatch. "If it breaches $960 it might make a quick run to $975, or it might swing back to the lower end."


In London bullion, the benchmark gold price was fixed $1.75 higher earlier in the day to $950.00 an ounce. Silver gained 36 cents to $13.76 an ounce. Platinum was adjusted $10 higher to stand at $1,176.00.

Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies.

Oil and gasoline prices

Oil surged following a 21 cent decline on Wednesday. Crude-oil futures tracked to a new three-week high "as mostly upbeat company earnings and U.S. home sales data lifted stock markets and raised hopes for an economic recovery," wrote Moming Zhou and Polya Lesova of MarketWatch.


"The financial markets are back in play as primary driver of oil prices as today’s triple digit run-up in the Dow Jones Industrial Index to highest levels of this year ignited a fresh influx of passive investment capital into the energy space," Jim Ritterbusch, president of oil consultancy Ritterbusch & Associates, was quoted on Reuters.


New York crude-oil for September delivery rose $1.76, or 2.7 percent, to close at $67.16 a barrel.

For the second straight day and following weeks of declines, prices at the pump climbed. AAA reported the national average for unleaded gasoline rose four-tenths of a cent to $2.465 a gallon. The price is 2.7 cents cheaper than last week, 21.8 cents less than a month back, and $1.58 lower than a year ago.

U.S. Stocks

U.S. stocks rallied Thursday as the Dow hit an eight-month high with a gain of 200 points. The other major indexes jumped as well — the Nasdaq finished higher for the 12th straight day.

The Dow Jones industrial average soared 199.74 points, or 2.25 percent, to 9,081.00. The S&P 500 Index jumped 24.09 points, or 2.52 percent, to 978.16. The Nasdaq Composite Index surged 49.43 points, or 2.57 percent, to 1,975.81.

Check out additional market resources at Live Bullion Spots, the Silver Calculator, U.S. Mint Collector Bullion Price Guide, and the Inflation Calculator.

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