Gold pared the gains it made this morning after European stock markets surged, while futures for the leading US indexes moved up, pointing to a higher open on Wall Street. The safe haven gold fell out of demand after European stock markets rallied with the FTSE 100 rallying 1.2%, boosted by gains in the insurance and mining sectors, with the latter benefitting from higher metal prices. Insurers were in demand after Bank of American Merrill Lynch and stockbroker Panmure Gordon (LON:PMR) raised the price targets for major Aviva (LON:AV). The Dow Jones and the broader S&P 500 indexes are currently projected to open today’s session with small gains after recovering from a sharp fall on US jobs report on Friday. The disappointing non-farm payroll update showed 131,000 jobs lost compared to expectations of a 60,000-70,000 decline, while also revising June’s reported job losses to 221,000 from 125,000. The bearish data pushed down equities in Europe and the US to spur safe haven buying, giving gold enough support to stay above the US$1,200/oz level. Physical demand has been high over the past couple of weeks with bargain hunters taking advantage of low prices, which hit three month lows in late July. Indian jewellers have been buying bullion ahead of the festival season in that country. Gold slid back to US$1,205/oz, while silver retreated to US$18.46/oz and platinum declined to US$1,555/oz. Major mining stocks were in demand today. Gold miner Randgold Resources (LON:RRS) and silver miner Fresnillo (LON:FRES) added 1%, while platinum miner Lonmin (LON:LMI) climbed 1.7%. African Barrick Gold (LON:ABG) went against the tide, posting a small loss. Specialty chemicals firm Johnson Matthey (LON:JMAT) advanced 1%. Gold miner Petropavlovsk (LON:POG) and silver producer Hochschild Mining (LON:HOC) stood just above the opening level, while fellow midcap Aquarius Platinum (LON:AQP) tacked on 2%. Small cap companies didn’t move by much today. Junior diamond producer Stellar Diamonds (LON:STEL) was an exception shedding 9.5%.

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