G-khan
03-26-2003, 10:19 PM
Wed March 26, 2003 06:14 AM ET
By Steven Swindells
LONDON (Reuters) - Gold gained on Wednesday but trade was thin as investors kept to the sidelines, waiting for direction from the war in Iraq.
Spot gold was quoted at $329.25/330.00 an ounce at 5:51 a.m. EST, up from $328.25/329.00 an ounce at the New York close on Tuesday but off last month's 6-1/2 year high of $388.50.
"Although gold is finding some good support from physical demand, liquidation from speculators and risk-averse investors continues to weigh on the metal," said John Reade, metals analyst at UBS Warburg.
"Barring a catastrophe, it is hard to see gold rallying sustainably until the conflict in Iraq has ended, or at least moved from the front to the inner pages of world newspapers," Reade said.
Jitters over the course of the war in Iraq left many financial markets hovering on Wednesday although oil prices continued to climb on supply worries.
European stocks were little changed, the dollar was steady against major currencies, having eased on Tuesday, and bond yields were mixed.
The moves contrasted with four hectic trading days since the U.S.-led attack on Iraq began in which investors at first drove up stocks and dumped safe-haven investments then did a sharp about-face when it appeared the war could be prolonged.
Markets were keeping their focus on the war as U.S. planes and missiles targeted Iraqi state television in Baghdad and pounded positions held by Republican Guards defending the approaches to the city.
"Although the technical support level of $330 has been breached the price has been given some support by the recent weakening of the dollar," said Barclays Capital in a report.
"Below this price the next level of support is located around $315, the last level at which there was substantial physical demand," it said.
Gold was set or "fixed" in the London morning session at $329.60 an ounce, down from the previous $331.90 fix.
In other precious metals, palladium hugged five-year lows on a poor demand outlook for the industrial metal.
Spot palladium was quoted at $195/201 an ounce, down from $202/207 at the New York close on Tuesday.
"Palladium finally gave way..(on) a combination of falling industrial demand, particularly from the auto manufacturing sector as car sales are set to fall sharply this year, and rising supplies as new mining projects in the Eastern Bushveld (in South Africa) come online," said James Moore, analyst at TheBullionDesk.com.
"Industrial demand is set to remain low, as has been underlined by the recent bout of poor consumer confidence figures and, with both mining and reclaimed supplies set to rise sharply, I think this is the start of a much larger push lower for the industrial metal," Moore said.
Platinum was quoted at $642/647 an ounce from $650.55/655.00 and silver was at $4.37/39 from $4.38/40.
http://www.reuters.com/financeNewsArticle.jhtml?type=businessNews&storyID=2450649
By Steven Swindells
LONDON (Reuters) - Gold gained on Wednesday but trade was thin as investors kept to the sidelines, waiting for direction from the war in Iraq.
Spot gold was quoted at $329.25/330.00 an ounce at 5:51 a.m. EST, up from $328.25/329.00 an ounce at the New York close on Tuesday but off last month's 6-1/2 year high of $388.50.
"Although gold is finding some good support from physical demand, liquidation from speculators and risk-averse investors continues to weigh on the metal," said John Reade, metals analyst at UBS Warburg.
"Barring a catastrophe, it is hard to see gold rallying sustainably until the conflict in Iraq has ended, or at least moved from the front to the inner pages of world newspapers," Reade said.
Jitters over the course of the war in Iraq left many financial markets hovering on Wednesday although oil prices continued to climb on supply worries.
European stocks were little changed, the dollar was steady against major currencies, having eased on Tuesday, and bond yields were mixed.
The moves contrasted with four hectic trading days since the U.S.-led attack on Iraq began in which investors at first drove up stocks and dumped safe-haven investments then did a sharp about-face when it appeared the war could be prolonged.
Markets were keeping their focus on the war as U.S. planes and missiles targeted Iraqi state television in Baghdad and pounded positions held by Republican Guards defending the approaches to the city.
"Although the technical support level of $330 has been breached the price has been given some support by the recent weakening of the dollar," said Barclays Capital in a report.
"Below this price the next level of support is located around $315, the last level at which there was substantial physical demand," it said.
Gold was set or "fixed" in the London morning session at $329.60 an ounce, down from the previous $331.90 fix.
In other precious metals, palladium hugged five-year lows on a poor demand outlook for the industrial metal.
Spot palladium was quoted at $195/201 an ounce, down from $202/207 at the New York close on Tuesday.
"Palladium finally gave way..(on) a combination of falling industrial demand, particularly from the auto manufacturing sector as car sales are set to fall sharply this year, and rising supplies as new mining projects in the Eastern Bushveld (in South Africa) come online," said James Moore, analyst at TheBullionDesk.com.
"Industrial demand is set to remain low, as has been underlined by the recent bout of poor consumer confidence figures and, with both mining and reclaimed supplies set to rise sharply, I think this is the start of a much larger push lower for the industrial metal," Moore said.
Platinum was quoted at $642/647 an ounce from $650.55/655.00 and silver was at $4.37/39 from $4.38/40.
http://www.reuters.com/financeNewsArticle.jhtml?type=businessNews&storyID=2450649