Gold Prices Around $1,590 an Ounce Mark, Silver Prices Gain
Gold prices hovered around $1,590 an ounce level during Asian trading hours on Friday as investors remain disinclined to take bets on safe haven assets amid improving macroeconomic environment in the U.S. Silver prices, meanwhile, edged higher in early trading on Friday.
At last check U.S. gold futures for April delivery inched up 0.07% to $1,591.80 an ounce while spot gold gained 0.25% to $1,593.70 an ounce.
However, gold is on course to post second successive weekly gains as some market participants still prefer to keep exposure in inflation hedge bets in the backdrop of aggressive monetary easing from global central banks. In addition, simmering concerns over euro zone’s economic recovery is also preventing any large-scale sell-off of bullion.
“It is a global trend that the value of paper money is diminishing, which attracts investors to gold, a hard asset,” said Li Ning, an analyst at Shanghai CIFCO Futures, according to Reuters.
“That’s why gold has been resilient recently even though we have seen good data from the United States, strength in equities and a firm dollar,” added Ning.
Earlier on Thursday, the Labor Department’s weekly first- time jobless claims data showed that number of applicants declined against economists’ expectation of gains. The data immediately boosted the dollar while U.S. equities also rallied. On Thursday, the Dow Jones extended its all-time-high level and posted a record of 10 days of winning streak.
Analysts believe that gold will struggle to break above $1,600 an ounce although the metal has found a strong support at $1,550. Significantly improving economic data and bull runs in the equity markets would lure investors towards riskier assets, capping gold gains say analysts.
In a research note to clients, Ed Meir, an analyst at INTL FCStone said, “ Gold’s fate, we think, will largely ride on what direction US equity markets will take.”
Silver futures edged up 0.24% to $28.875 an ounce.
In pre-market trading, the iShares Silver Trust (ETF) (NYSE: SLV) was up 0.65%, and the ProShares UltraShort Silver (ETF) (NYSE: AGQ) was up 0.64%.
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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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