Arab Today, arab today gold rebounds after price slump as buyers return
Last Updated : GMT 12:18:37
Arab Today, arab today
Arab Today, arab today

Gold rebounds after price slump as buyers return

Arab Today, arab today

Arab Today, arab today Gold rebounds after price slump as buyers return

London - SUNA

Gold rebounded on Thursday as physical bullion investors were tempted back to the market by the previous session\'s 5 percent price plunge, its biggest one-day drop since before the collapse of Lehman Brothers in October 2008. Spot gold was up 1.3 percent at $1,716.94 an ounce at 1058 GMT, while US gold futures for April delivery were up $7.20 an ounce at $1,718.50. Spot prices fell more than 5 percent on Wednesday after Federal Reserve chair Ben Bernanke gave no hints that a third round of quantitative easing, which had been a key support of gold prices, was imminent in the world\'s largest economy. Activity in COMEX gold futures spiked to 342,000 lots that day, more than double both the previous session\'s volume and the one-month rolling average. \"We had a sense that the gold market was increasingly pricing in QE3, and obviously Bernanke has put a dampener on that,\" said Standard Bank analyst Walter de Wet. In key Asian physical gold markets overnight, jewelers, traders and investors rushed to take advantage of the nearly $100 drop in prices. \"It\'s been a long time since we (saw) such decent buying,\" said one Hong Kong-based dealer.  \"We\'ve seen physical flows coming off steadily since the beginning of February,\" said de Wet. \"The physical demand is just not there when gold is at $1,750-$1,800, and you really need that on top of the financial demand to push gold much higher.\" He added, \"Already we\'ve seen some decent buying below $1,700 early this morning. That is coming through, but it will probably fall away as we reach the $1,750 level.\" Investment in gold-backed exchange-traded products, which issue securities backed with physical bullion, also rose on Wednesday, with holdings of the largest, New York\'s SPDR Gold Trust, up just over 9 tonnes, the biggest one-day rise since January. A lack of demand for physical bullion in recent weeks meant gold had little additional support once selling got underway on Comex, after Bernanke\'s remarks. \"We think a large part of why gold conceded so much came down to three other factors - $1,800 was proving to be too much of a hurdle and a certain staleness had entered the market; positioning had increased very swiftly in recent weeks; and physical demand has been non-existent,\" said UBS in a note. \"What the physical community do from here is hugely important,\" it added. A recovery in other markets, many of them with heavy losses on Wednesday, also helped gold move higher. The euro edged up 0.1 percent against the dollar after earlier hitting a one-week low. European shares reversed earlier losses to move higher, with investors cheered by this week\'s ECB cash injection on the banking sector and peripheral countries such as Italy. German government bonds hovered near record highs after the news. Among other precious metals, silver was up 0.4 percent at $34.73 an ounce. It also fell more than 6 percent on Wednesday in gold\'s wake. The gold/silver ratio, the number of silver ounces needed to buy an ounce of gold, jumped back up to 49.4 from a five-month low of 48.4 earlier on Wednesday. \"Silver did manage to hold its short-term uptrend support, off the December 29 low, currently around 34.37, on a closing basis,\" said ScotiaMocatta in a note. \"What was notable in the silver technicals was the strong rejection at 37.31, which is the 61.8 percent Fibonacci retracement level of the August to December downtrend,\" it added. \"Key support is at 33.00, which has held on a closing basis since January 25.\" Spot platinum was up 1 percent at $1,692.50 an ounce, while palladium was up 0.2 percent at $699.97 an ounce.

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Arab Today, arab today gold rebounds after price slump as buyers return Arab Today, arab today gold rebounds after price slump as buyers return

 



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