TOKYO - Gold was mostly unchanged on Thursday, holding around $910 ahead of the formal release of the results of the U.S. government’s bank “stress tests” that will provide a gauge of the health of financial institutions.
Bullion rose on Wednesday as news reports of the test results trickled out, some of which underscored lingering uncertainties about banks helping to bolster bullion’s appeal as a safe-haven asset.
The “stress tests”, which will help show whether financial institutions can weather a deep recession, will be released on Thursday.
“There will be a lot of people ... holding their positions ... (although) you might get a little bit more unwinding before the day’s out,” said Darren Heathcote of Investec Australia in Sydney.
Gold was at $909.65 per ounce at 0241 GMT, compared with New York’s notional close of $909.90.
The yen fell against major currencies on Thursday as risk aversion dropped on improving clarity about the health of the financial system amid a stream of news reports ahead of the actual release of the “stress test” results.
The perception that the global economy has seen the worst of the economic downturn drew investors to equities at gold’s expense.
This was underscored by another drop in the world’s largest gold-backed exchange-traded fund.
The SPDR Gold Trust, said holdings fell to 1,104.09 tonnes as of May 6, down 0.36 tonnes or 0.03 percent from the previous day.
Holdings are now down 2 percent since hitting a record high of 1,127.68 tonnes on April 9 as a rise in share prices has decreased bullion’s appeal.
The world’s largest silver-backed exchange-traded fund, the iShares Silver Trust SLV, also said its holdings fell 61.28 tonnes or 0.7 percent from the previous day to 8,348.18 tonnes as of May 6.
This is down from a record high of 8,413.01 tonnes on April 3.
Share prices drew strength from growing clarity about the health of the U.S. financial system, while the yen fell against major currencies.
Japan’s Nikkei average jumped 4 percent on Thursday to a six-month high.
The dollar rose 0.4 percent to 98.74 yen JPY from late U.S. trade on Wednesday.
