Stock Market Watch

Gold Prices Extend Gains, Silver Prices Climb More than 1.25%

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Gold prices extended gains during Asian trading hours on Thursday as the U.S. dollar traded broadly lower after the release of a very tepid producer price index in the previous session. Silver prices, meanwhile, also rose sharply in early trading on Thursday.

The lack of inflationary presence has reignited speculation that the Federal Reserve might not decide against the tapering of the bond purchase program, in the near future.

At last check, gold futures for December delivery edged up 0.40% to $1,338.70 an ounce while spot gold gained 0.26% to $1,338.04 an ounce.

Earlier on Wednesday, the Labor Department’s Producer Price Index, a measure of inflation, showed that “core” wholesale inflation, rose just 0.1% in July compared to economists’ expectation for 0.2% increase.

Later in the afternoon, St Louis Fed President James Bullard also pointed out that the inflation was still low and insisted that the Fed should stick to its 2% inflation target. However, he also warned of possible excessive inflation in the long-term.

The weak data weighed on the dollar. The dollar index, a measure on U.S. unit’s performance against six major currencies, fell 0.19% to 81.56 on Thursday.

The news that holdings of the world’s largest gold-backed ETF, the SPDR Gold Trust, rose for the second time in as many weeks also supported gold prices. The fund’s holdings rose for the time since June on last Friday. Since then holdings remained mainly unchanged. On Wednesday, the fund’s holdings rose another 0.23% to 913.23 tons, according to Reuters.

Silver futures climbed 1.30% to $22.07 an ounce.

In pre-market trading, the iShares Silver Trust (ETF) (NYSE: SLV) was up 0.81%, and the ProShares Ultra Silver (ETF) (NYSE: AGQ) was up 1.72%.

 








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edliston
Post Written By: Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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