Stock Market Watch

Gold Prices Up, Silver Prices Slip

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Gold prices edged higher during Asian trading hours on Wednesday thanks to strong physical side demand from Asia, especially China; however, gains are likely to be capped as investors are disinclined towards investing in safe-haven bets at time when global equities are rallying. Silver prices, meanwhile, edged lower in early trading on Wednesday.

At last check, gold futures for June delivery gained 0.23% to $1,452.10 an ounce while spot gold inched up 0.07% to $1.453.06 an ounce. Silver futures slipped 0.09% to $23.785 an ounce.

Earlier on Tuesday gold futures tumbled 1.3% to settle at $1,448.80 an ounce at COMEX division of the New York Mercantile Stock Exchange as multi-year high equities enticed investors towards high risk-return equity markets. While S&P 500 Index entered “bull” territory, having climbed about 20% since last November, the Dow Jones Index breached and closed above 15,000 points millstone. Better-than-expected German industrial orders data and Nikkei 225 index’s multi-year- high close boosted the sentiment.

Physical metal however is benefitting from soaring demand in China. According to Reuters, China’s gold import from Hong Kong rose to record high level in March and the demand could remain healthy in coming months which turn would support prices. Dealers in Asia are still struggling to fulfill the demand for gold bars, coins and nuggets.

Speaking to Reuters, a Hong Kong based dealer said, “There’s still a shortage in physical metal, which is why premiums are at very high levels. We can say premiums for gold bars are at $3.50 an ounce.”

Nevertheless, constant liquidations in gold-backed ETF’s are indicative of the fact that the overall investors’ sentiment on the metal remains subdued.

A data provided by Reuters showed that holdings of the SPDR Gold Trust (ETF) (NYSE: GLD), the world’s largest gold-backed ETF, dropped 0.42% to 1057.79 tons on Tuesday, a lowest level since early 2009.

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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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