Stock Market Watch

Gold Prices Jump More Than 2% As Equities Plunge

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Gold prices pared sharp losses and were heading towards a higher close in a very volatile session on Thursday as weakness in the U.S dollar and massive sell-off in U.S. equities encouraged investors to take safe-haven bets in hordes.

At last check, gold futures for December delivery jumped 2.56% to $1,367.60 an ounce while spot gold jumped 1.96% to $1,360.71 an ounce.

The SPDR Gold Trust (ETF) (NYSE: GLD) was last up 2.27% to $131.93

Silver futures leaped 4.51% to $22.77 an ounce.

Bullion, having extended gains in the Asian trading session came under heavy sell-off pressure, tumbling more than 1% after the Labor Department said that the jobless claims fell to its lowest level in nearly last six years. The data boosted the U.S. dollar even as yields on treasuries soared. Investors feared that the Federal Reserve might soon begin to taper its gold supportive bond purchase program.

However, some other economic indicators were unexpectedly weak. While the New York Fed’s Empire State Manufacturing Index contracted in August, the Philadelphia Fed’s data on the mid-Atlantic factory activities showed sharp slowdown as well. Besides, the industrial production also remained unchanged in July, said the Federal Reserve.

A spate of disappointing data releases along with lackluster earnings outlook from some of the prominent U.S. retail chains, sparked off panic sell-off across-the-board. This in turn, burnished the metal’s safe haven appeal.

In an e-mailed comments to investors, Brien Lundin, editor of Gold Newsletter said, “Pundits out there are touting safe haven demand, and I can’t argue with that…The deteriorating situation in Egypt and the selloff in U.S. equities are undoubtedly having an effect,” according to MarketWatch.

 








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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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