Gold climbs to three month high despite opposing pressures
Despite a stronger dollar, falling commodity and stock indices in addition to declining oil, the precious metals' uphill surge was not discouraged yesterday. Bearish American stocks caused liquidity to flow into alternative investments, raising the price of metals noticeably among them gold, silver and platinum.
The Dow Jones Industrial Average tumbled by 0.66% and closed at 10897.52 while NASDAQ fell 0.23%. Commodity indices closed with losses, where oil was trading below $86.00 per barrel as the S&P GSCI index lost 3.09 points to close at 544.10 and 0.93 points were lost by the RG/CRB index that ended trading at 277.59.
Gold ended New York trading yesterday at $1148.00 advancing 1.21%; while silver gained 1.28% and closed at $18.13, platinum followed the mainstream movement rising 0.12% to close at $1701.00 per ounce where it closed in London even higher at $1710.00.
Precious metals have gained popularity as alternative investments and also (with gold being preferred) a safe haven, as uncertainty reigns through markets as the health of the global economy is under scrutiny. Investors are questioning the excessive gains across equity markets during the previous period which they now see was exaggerated; this is steadily driving confidence out of markets as the rapid growth markets that slumped yesterday triggering a new profit-taking wave.
Asian stocks today followed the downward movement their American and European counterparts have taken yesterday. The Nikkei index settled at 11170.05 as it lost 122.78 points or 1.04%, a drop considered relatively large when compared to other leading world indices.
Silver and platinum are continuing their conquest of higher grounds as they are currently trading with a rise at $18.16 and $1708.00 consecutively as of 1:31am EST, while gold isn't moving far from yesterday's New York closing price trading around $1147.30 per ounce. Gold traders have been engaged in profit-taking, while others have placed buying orders, due to the ongoing jitters and fear over the outlook for the global economy.
Due to speculative powers in the prior period and rising dollar sided by falling oil, a negative impulse may be witnessed today in the precious metals market. These conditions may push speculators into profit-taking, thus a drop in gold is anticipated. However, the general trend for precious metals seems to be uphill, as the preciously mentioned factors are not likely to alter the main course of precious metals.