Commodities: Gold regains its allure

Date: Friday 26 Feb 2010

Gold futures bounced back from a two-week low Thursday as the dollar gave back some of its early gains made on heightened concerns about Greece’s debt problems.

The April contract rose $11.30 to $1,108.50 an ounce in New York, but had been about $20 lower earlier on, its worst level since 10 February.

Bargain hunters were also on the prowl after the yellow metal fell from a one-month high on Monday.

"We expect dips to continue to draw investment support on inflation or deflation concerns and Greek downgrade or default worries, with gold holding in a broad band between $1,074 and $1,130," said Bullion Desk analysts.

Elsewhere, silver and platinum improved, but copper and palladium fell.

Oil price tumbled over 2% as traders reacted to an unexpected increase in US weekly jobless claims, sovereign debt fears and worries about energy demand in America.

Initial jobless claims jumped to 496,000 in the week ended 20 February, far more than the 460,000 forecast and their highest in more than three months.

Meanwhile, Moody’s Investors Service said early Thursday that any changes in its ratings on Greece depend on the Greek government doing what it has promised. Standard & Poor's said Wednesday it may downgrade Greece's BBB-plus rating by one or two notches within a month.

US light crude for April delivery fell $1.83 to end the session in New York at $78.17 a barrel.

A storm that moved into the East Coast helped limit losses.

« Go back to news channel

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE