MW: Gold, silver futures rally on Europe debt hopes
Hopes are rising that the European debt crisis will be resolved
By Polya Lesova and Michael Kitchen, MarketWatch
LONDON (MarketWatch) — Gold and silver futures surged early Tuesday, rebounding from their recent slump as hopes rose for a resolution to the European debt crisis.
Gold for December delivery GC1Z +4.81% rallied $81.20, or 5%, to $1,676 an ounce in electronic trading on Globex.
Silver futures posted even more dramatic gains, with the December contract SI1Z +9.24% rallying $2.81, or 9.4%, to $32.78 an ounce.
Asian and European equity markets also posted strong gains on Tuesday, buoyed by reports that euro-zone officials are planning to boost the firepower of the region’s bailout fund in an attempt to bring the debt crisis under control.
“The rise in risk sentiment has also reduced the rush to generate cash, taking the pressure off the precious metals," said James Moore, an analyst at TheBullionDesk.com, in a note. However, gold “remains vulnerable to further bouts of liquidation,” he noted.
Concerns over a possible global liquidity crunch had sent gold futures falling 2.7% and silver down a milder 0.4% in Monday trading on the Comex division of the New York Mercantile Exchange.
Gold’s Monday settlement was the lowest since late July. Read more on Monday’s metals action.
