Stock Market Watch

Gold Prices Hit 2-½ Week High; Silver Prices also Gain

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Gold prices, which slipped during Asian trading hours, rebounded towards the end of the U.S. trading session on Tuesday  to hit its 2 ½ week high as concerns over Cypriot Parliament’s vote over the proposal of taxing depositors boosted the demand for safe haven bets. Silver prices also edged higher on Tuesday.

At last check, U.S. gold futures for April delivery gained 0.42% to $1,611.40 an ounce while spot gold edged up 0.40% to $1,611.18 an ounce.

Earlier during the day (during Asian trading hours) the metal pared some of its gains made in the previous session as concerns over Cyprus’s bailout agreement eased slightly after euro zone finance ministers offered a new proposal which called for tax exemption on depositors having savings less than euro 100,000, giving some flexibility to the troubled nation.

However, concerns over possible flare up of debt crisis in the euro zone started to mount towards the end of the day as Cypriot parliament began voting on bailout agreement. Earlier today, a Reuters report quoted a spokesman from Cypriot government as saying that parliamentarians were unlikely to vote in favor of the bailout proposal (the bailout condition laid by the euro zone finance ministers, which demanded taxing depositors by 9.95 %).

“Some flight to safety was already seen yesterday but there was no conviction and gold failed to hold onto its gains and now people are again getting nervous and that’s pushing the market higher” said Deutsche Bank precious metals trader Michael Blumenroth, according to Reuters.

Meanwhile investors will also keep an eye on the Federal Reserve’s policy rate statement, scheduled to be released tomorrow. Investors will be keen to know the Fed’s views on current round of quantitative easing amid significantly improving labor and housing market.

Silver futures inched up 0.06% to $28.89 an ounce.

In late trading on Tuesday, the iShares Silver Trust (ETF) (NYSE: SLV) was down 0.04% to $27.94, the ProShares Ultra Silver (ETF) (NYSE: AGQ) was down 0.03% to $39.27, and the ProShares UltraShort Silver (ETF) (NYSE: ZSL) was up 0.06% to $53.17.

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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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