Silver all but erases Tuesday losses; copper contract rallies
By Myra P. Saefong and Virginia Harrison, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold futures climbed nearly $30 an ounce Wednesday as uncertainty surrounding Greece’s debt crisis helped position the market for its first gain in four sessions.
In addition, traders awaited the outcome of the Federal Reserve’s policy meeting and a press conference led by Ben Bernanke, chairman of the U.S. central bank.
Gold for December delivery GC1Z +1.63% gained $29.50, or 1.7%, to $1,741.30 an ounce on the Comex division of the New York Mercantile Exchange after tapping a high of $1,745.60. Futures prices have lost about $36 in the past three trading sessions.
“Gold continues to ride oscillating fear and relief in the euro zone,” said Peter Grant, senior metals analyst at USAGold-Centennial Precious Metals Inc.
“There are also lingering expectations of [a third round of quantitative easing], although I suspect that the October rally in stocks bought the Fed some time on that,” he said. “Perhaps some tweaking of the language, but I’m not expecting any additional quantitative measures to be revealed today.”
Papandreou’s decision earlier this week to put the nation’s latest bailout plan to a public vote inflamed fears about a Greek sovereign-debt default. Read more about the latest Greek turmoil.
The announcement caught other euro-zone nations by surprise, prompting German Chancellor Angela Merkel and French President Nicolas Sarkozy to organize an emergency Wednesday meeting in Cannes, France, on the eve of a summit of the Group of 20 nations.
The debt concerns drew “investors towards the safe-haven assets such as gold, while the industrial metals remain overhung by slowing macroeconomic activity,” wrote James Moore, analyst at TheBullionDesk.com, in a note.
Silver futures for December delivery SI1Z +4.56% added $1.56, or 4.8%, to $34.29 an ounce, a reversal after a 4.7% decline in the previous session.
December copper HG1Z +2.91% added 9 cents, or 2.7%, to $3.60 a pound.
January platinum PL2F +1.85% improved $31.50, or 2%, to $1,613.50 an ounce, while palladium PA1Z +2.08% for December delivery put on $13.65, or 2.2%, to $648.65 an ounce.
Bernanke’s press conference, set to take place at 2:15 p.m. Eastern will be potentially important in that it could shed light on how close the central bank is to another round of quantitative easing. The press conference will follow the Federal Open Market Committee’s policy statement slated for 12:30 p.m. as well the close of Comex gold trading at 1:30 p.m. Read the Fed preview story.
Also Wednesday, the dollar index DXY -0.66% , which tracks the performance of the greenback against a basket of rival currencies, fell to 76.794 from 77.298 late Tuesday. A weaker greenback tends to support investment in dollar-priced commodities as it makes them less expensive to holders of other currencies.
