MW: Gold futures higher as worries persist over Greece
By Claudia Assis & Kate Gibson, MarketWatch
SAN FRANCISCO (MarketWatch) -- Gold futures struggled to hold on to gains Monday as investors kept a close eye on the euro and a murky backdrop for eurozone countries.
Gold futures for June delivery, the most active contract, gained $1, or 0.1%, at $1154.70 an ounce on the Comex division of the New York Mercantile Exchange.
Prices have fluctuated, however, and the contract briefly dipped lower and hit an intraday low of $1,152.30 an ounce.
German Chancellor Angela Merkel said Monday that aid will be provided to Greece if absolutely necessary and reiterated that it's not an option for Greece to leave the euro zone.
Merkel cautioned that an aid deal still needs to be worked out, and assistance will be provided if Greece meets certain conditions.
The euro deepened its decline against the U.S. dollar after her remarks.
The dollar index (DXY 81.60, +0.13, +0.16%) , which tracks the performance of the greenback against a basket of other major currencies, rose 0.2% to 81.54.
"The strength in the dollar helped sap some of the argument" about gold as a hedge against inflation, leading to a wobbly gold market, said Darin Newsom, a senior analyst with Telvent DTN in Omaha.
Gold gained nearly 1% on Friday, ending the week with a 1.5% gain.
Meanwhile, silver for May delivery gained 15 cents, or 0.8%, at $18.34 an ounce. Platinum for July delivery rose $10, or 0.6%, to $1,751.70 an ounce. Palladium for June delivery added $5.95, or 1.1%, to $569.15 an ounce.
Greek Finance Minister George Papaconstantinou tried to reassure investors on Sunday, saying his nation wouldn't have to restructure its debt and would never leave the euro zone. Concern that Germany will resist plan.
In Venezuela, President Hugo Chavez on Sunday said he might nationalize the country's gold mines, accusing mining companies of hurting the environment and violating workers' rights, according to published reports.
Before investors worry about supply problems following Venezuela's actions, however, they should consider the fact that Venezuela is not a big gold producer, Kitco Metals senior analyst Jon Nadler said in a report Monday.
Last year, the Venezuelan government reportedly took control of a gold mine run by U.S. mining company Gold Reserve Inc. (GRZ 1.17, 0.00, 0.00%) , while the prior year Toronto-based Crystallex International Corp. (KRY 0.40, -0.03, -5.91%) said it had been denied a permit for its Las Cristinas gold mine by Venezuela's Environment Ministry.
