SF: Gold Price Rises as Weak Labor Market Stokes Demand for Haven
June 30 (Bloomberg) -- Gold rose for a second day as signs of a struggling U.S. labor market stoked demand for bullion as a means of protecting wealth amid economic uncertainties.
Companies in the U.S. hired fewer workers in June than forecast, according to private-payroll data. Another report showed business activity expanded at a slower pace than May. Before today, gold jumped 13 percent this year, partly on demand for a haven amid Europe's sovereign-debt woes and concerns that the global recovery may slow.
"Sentiment is still sour," said Andrey Kryuchenkov, an analyst at VTB Capital in London. Gold may climb higher amid "ongoing uncertainty," he said.
Gold futures for delivery in August rose $2.10, or 0.2 percent, to $1,244.70 an ounce at 11:21 a.m. on the Comex in New York. The precious metal, up 2.5 percent in June, has climbed 13 percent this quarter, the most since the third quarter of 2007.
This month, gold reached all-time highs in dollars, euros, U.K. pounds and Swiss francs. Holdings in the world's biggest gold-backed exchange-traded fund rose to a record yesterday.
"Every bank around the world is printing money to help stimulate the economy," said Michael K. Smith, the president of T&K Futures & Options in Port St. Lucie, Florida. Gold may reach $1,300 by the end of the year, surpassing its June 21 record of $1,266.50, as demand rises for a hedge against "huge inflation," he said.
ETF Gold Holdings
Assets in the SPDR Gold Trust, the biggest ETF backed by bullion, gained 4.26 metric tons to a record 1,320.44 tons yesterday, according to the company's website. Global holdings of the metal by ETFs rose 3.9 tons to an all-time high 2,067.7 tons yesterday, according to Bloomberg data from 10 providers.
"A mountain of sovereign debt in the Western world and growth concerns" are giving "rock-solid support" to gold, Filip Petersson, an analyst at Swedish bank SEB AB's commodity unit, said in a report.
Silver futures for September delivery fell 5.5 cents, or 0.3 percent, to $18.58 an ounce, paring its gain this quarter to 6 percent. The metal is heading for a sixth straight quarterly advance, the longest winning streak since the end of 1979.
Platinum futures for October delivery fell $22.10, or 1.4 percent, to $1,533 an ounce on the New York Mercantile Exchange. Palladium futures for September delivery declined $12.40, or 2.7 percent, to $442 an ounce. Both metals are set for their first quarterly loss since the end of 2008.
