Gold recovered from Thursday’s sharp falls, surging to US$1,211/oz this morning after shedding more than 3% yesterday to slip below the key US$1,200/oz level. Despite this week’s massive selloff in the markets that was triggered by disappointing data released in the US and China, investors were increasingly dumping the safe-haven gold to reap gains from the yellow metals’ recent rally that almost drove it to US$1,300/oz and make up for the losses in equity markets. Yesterday’s US jobless claims update showed an unexpected increase of 13,000 to 472,000, while PMI (Purchasing Managers Indexes) in the US and China declined to reflect a lower rate of growth of manufacturing activity in these countries. Gold failed to benefit from a declining US dollar, which fell against the euro yesterday amid the weakness in the markets and bad data. After posting its biggest loss in five months, gold was in demand among bargain hunters today, helping it to return above US$1,200/oz. Silver and platinum moved along, climbing to US$18.03/oz and US$1,507/oz respectively. Major mining stocks were in demand today. Randgold Resources (LON:RRS) led the sector in the FTSE 100 with a 2.2% advance, while fellow gold miner from the FTSE 250 Petropavlovsk (LON:POG) followed with a 2.1% gain. Platinum miner Lonmin (LON:LMI) advanced 1.8% and silver miner Fresnillo (LON:FRES) posted a small gain. Aquarius Platinum (LON:AQP) led the midcaps with a 3.6% rally. Silver producer Hochschild Mining (LON:HOC) added 1%. Blue chip specialty chemicals firm Johnson Matthey (LON:JMAT) rose 1.3%.

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