Gold Prices Jump Above $1300, Silver Advances


Gold Prices Fall to 3-Week Low, Silver Plummets 3.2%U.S. gold notched another record high Tuesday. Gold prices neared $1,312 an ounce as the dollar dropped to an eight-month low and data showed U.S. consumer confidence in September plunged to its lowest level in seven months.

The yellow metal has hit a fresh record in eight of the last nine trading sessions, and is up 19 percent this year with its 0.7 percent increase on Tuesday.

Precious metals moved higher as a group. Palladium performed the strongest, rising 1.5 percent. Silver followed at 1.1 percent. Platinum brought up the rear at 0.3 percent.

In other markets, crude oil fell to halt a four-day winning streak while U.S. stocks rose as the major indexes advanced between 0.40 and 0.50 percent.

New York precious metals closing prices follow:

  • Gold for December delivery added $9.70 to end at $1,308.30 an ounce on the Comex in New York. It ranged from $1,276.20 to $1,311.80.

  • December silver surged 23.6 cents to $21.707 an ounce. It ranged between $21.060 and $21.775.

  • Platinum for January delivery climbed $5.70 to close at $1,640.70 an ounce. It ranged from $1,609.00 to $1,641.90.

  • Palladium for December delivery jumped $8.25 to $560.45 an ounce. It ranged between $541.00 and $562.20.

In notable bullion quotes of the day:

"The sell-off in the dollar has taken gold off its lows," Adam Klopfenstein, a senior market strategist at Lind- Waldock in Chicago, said and was quoted on Bloomberg. "From here, it’s going to be a momentum trade, and you’re going to see new buying take gold to new highs."

"The growing realization that ultra loose monetary policies may debase currencies is leading to continuing safe haven demand for gold. Gold is the only currency that cannot be debased and its value is not dependent on the performance of politicians and central bankers," analysts at GoldCore said in a note cited on Reuters.

"The U.S. dollar index hit a fresh eight-month low Tuesday morning, after having stabilized for just a bit, when the U.S. consumer confidence index was released and showed a significantly weaker-than-expected reading," noted Jim Wyckoff of Kitco News.

"That news also sent U.S. Treasury prices higher and temporarily dented the U.S. stock market. Safe-haven buying interest in gold also quickly surfaced following the consumer confidence report’s release." Wyckoff added that "fresh worries about the European Union’s sovereign debt crisis have also crept back into the market, which is also supportive for gold prices."

In PM London bullion, the benchmark gold Fix price was $1,294.00 an ounce, down $3.00 from Monday. Silver was unchanged at $21.165 an ounce for a loss of 38 cents. Platinum settled at $1,614.00 an ounce, down $20.00. Palladium was $552.00 an ounce, falling $6.00.

United States Mint one-ounce bullion coin sales jumped between Monday and Tuesday. While the Gold Buffalo coins sold out, the Silver Eagle coin rallied 460,000 and the Gold Eagle coin advanced 15,000. Fractional Gold Eagles remained unchanged. The latest bullion coin figures as published by the United States Mint follow:

U.S. Mint 2010 Bullion Coin Sales
September 2010 Totals
American Eagle Gold 1 oz 73,000 878,000
American Eagle Gold 1/2 oz 1,000 35,000
American Eagle Gold 1/4 oz 2,000 50,000
American Eagle Gold 1/10 oz 20,000 345,000
American Buffalo Gold 1 oz 10,000 209,000
American Eagle Silver 1 oz 1,680,000 25,280,500


Oil and gasoline prices

New York crude oil prices fell 34 cents, or 0.44 percent, to settle at $76.18 a barrel. Weaker demand and an expected increase in crude inventories were among the cited factors.

"We really haven’t made any headway into stockpiles," Ben Westmore, a minerals and energy economist at National Australia Bank Ltd. in Melbourne, said and was quoted on Bloomberg. "Activity hasn’t improved. The crude market followed equity markets overnight."

The national average for regular unleaded gasoline dropped three-tenths of a cent to $2.691 a gallon, according to AAA fuel data. The price is also three-tenths of a cent less than last week, 1.3 cents more than a month back, and 19.2 cents higher than the price from a year ago.

U.S. Stocks

U.S. stocks rose modestly Tuesday, with one theme cited as a catalyst being expectations for the Fed to purchase more debt. End-of-month buying and better corporate earnings reports were also mentioned.

"Knowing the Fed is likely to announce another round of Treasury purchases, likely a month from now, buyers now are just jumping on board," Peter Boockvar, equity strategist at Miller Tabak & Co. in New York, said in a note to clients that was cited on Bloomberg. "Yes, there is an inherent contradiction of buying conventional Treasuries and believing in reflation but for now the Fed is on your side."

The Dow Jones industrial average rose 46.10 points, or 0.43 percent, to 10,858.14. The S&P’s 500 Index added 5.54 points, or 0.49 percent, to 1,147.70. The Nasdaq Composite Index climbed 9.82 points, or 0.41 percent, to 2,379.59.

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