By Barbara Kollmeyer, Sara Sjolin and Carla Mozee, MarketWatch MADRID (MarketWatch) — Gold futures surged nearly 2% an ounce Tuesday and moved into a fresh bull market as fears over possible U.S. military action against Syria drew investors into the perceived safety of the precious metal. Gold for December delivery GCZ3 +1.74% jumped $25.90, or 1.9%, to $1,419 an ounce on the Comex division of the New York Mercantile Exchange, erasing a Monday loss of $2.70, or 0.2%, on the New York Mercantile Exchange. It had risen as high as $1,423 an ounce. Gold is also now just over 20% up from the lows reached by some contracts in late June, officially putting into into a bull market. Technically, a bull market definition is a rise in value of any market by at least 20%, while a bear market works in the opposite direction. Gold prices, however, are still down more than 15% this year. Gold was building on gains from electronic trade late Monday after U.S. Secretary of State John Kerry said the U.S. will hold the Syrian government accountable for its “undeniable� use of chemical weapons against civilians in rebel-held areas outside of Damascus last week. Syria’s decision to allow United Nations inspectors came too late, and U.S. President Barack Obama will now decide how to respond, said Kerry. Syrian President Bashar al-Assad denied the use of chemical weapons and said the U.S. military will fail if it launches an attack against his country. “Concerns over emerging markets are among the factors weighing on risk sentiment with the Indian rupee and Turkish lira hitting record lows against the dollar. The possibility of Western military action in response to the chemical weapons attack in Syria is also boosting the appetite for both the black and yellow gold,� said Fawad Razaqzada, technical analyst at GFT Markets. Razaqzada said it also looks like investors are backing out of equities, at least for Tuesday and if that keeps up, more risk capital could be reallocated by investors into rallying precious metals. Gold has already moved past one of his resistance levels, which run between $1,415 and $1,425. The Federal Reserve has said improvement in the economy should lead it to reducing asset purchases from their current pace of $85 billion a month, but soft data has kept alive debate about the timing and the amount of tapering. The earliest the Fed could start lowering bond purchases is in September. Gold prices have been considered to be among the beneficiaries of stimulus from the Fed as well as from other central banks. Investors will receive the Conference Board’s gauge of U.S. consumer confidence in August at 9 a.m. U.S. Eastern Time. A drop in equities may result in the consumer-confidence index falling to 78.0 from 80.3, according to MarketWatch poll of analysts. Another sign that investors are moving back into gold came from Barclays on Monday, as they said exchange-traded products recorded their biggest daily inflow since Jan. 1 on Friday at 5.8 metric tons. Holdings of SPDR Gold Trust GLD +1.11% rose by 6.6 metric tons. In other action Tuesday, silver for September delivery SIU3 +2.12% rose 48 cents, or 2%, to $24.54 an ounce, extending Monday’s surge of 1.2%. September copper HGU3 +1.12% rose 1.3% to $3.36 a pound. October platinum PLV3 +0.13% gained $3 to $1,547.40 an ounce and September palladium PAU3 +0.07% traded higher by $3.25, or 0.4%, at $749.30 an ounce. Barbara Kollmeyer is an editor for MarketWatch in Madrid. Follow her on Twitter @MWBarbaraKollmeyer. Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin. Carla Mozee is a reporter for MarketWatch, based in Los Angeles. Follow her on Twitter @MWMozee.

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