MW: Gold futures gain more than 1%, shrug off early weakness
By Claudia Assis and Cynthia Lin, MarketWatch
SAN FRANCISCO (MarketWatch) -- Gold futures bounced more than 1% higher Friday, as investors were back to buy the metal after three straight sessions below $1,200 an ounce.
Gold for August delivery gained $17.40, or 1.5%, to $1,213.30 an ounce on the Comex division of the New York Mercantile Exchange, adding to marginal gains earlier in the session. Overall, gold has gained 0.5% for the week.
Gold tested lows around $1,182 before some economic indicators gave investors reason to adopt more of a positive view toward the global economy and prospects for growth this week.
The lower prices of recent sessions have attracted buyers interested in parking their money in a safe-haven investment ahead of the weekend, said Darin Newson, analyst with DTN Telvent in Omaha.
Physical demand for bullion has also provided support, as weaker prices seen in previous sessions sparked interest from jewelry buyers in Asia.
Earlier Friday, European Central Bank President Jean-Claude Trichet said that he saw stronger economic activity in the euro-zone region but that "it is still too early to declare the crisis over."
Against this backdrop, European equities moved higher, poised to make it four straight winning sessions, as U.S. stocks managed narrow morning gains. Read more about stocks.
Gold's short-term prospects remain closely calibrated to investors' appetite for risk.
"In the medium to long term, gold should remain in demand as a safe haven and protection against inflation," analysts with Commerzbank said in a note Friday. "In the short term, gold is likely to retreat further as investors are shifting to higher-risk investments."
The precious metal lost 4% last week, its biggest loss since the week ended May 21, and seesawed over the past three sessions.
