Gold twirls around $1135.93 markMorning trading saw gold settling around $1135.93 after the decline to $1124.00 it suffered yesterday, as it fell to the lowest levels since the April 6,after Goldman Sachs faced a fraud lawsuit filed by the U.S. Securities and Exchange Commission.
Gold ended with 0.2% rise at $1136.00 after fluctuating in morning trading, while silver gained 0.3% to reach $17.08 and platinum also appreciated by 0.1% to record $1696.90. Copper had also climbed by 1.0% trading at $7,769 per metric ton.
Anxiousness is spreading through financial markets with the Goldman Sachs lawsuit gaining momentum. The lawsuit has been filed by the U.S. Securities and Exchange commission that is accusing the bank of fraud using Collateral Debt Obligations (CDOs) in 2008.
Goldman Sach's accusers claim that the bank stands behind the recent ongoing financial crisis, as it had sold mortgage backed CDOs. Allegations have been backed by the bank's refusal to publish its mortgage investments in 2008, while a company's spokesperson Fiona Laffan denied any wrongdoing refraining to comment on the case.
The case is also catching attention from across the Atlantic as the British Prime Minister Gordon Brown urged the FSA to start an inquiry in the case as did the German Bafin, which asked the SEC for details on the case.
The EU is keen on investigating Goldman Sachs' role in the Greek swaps that caused the sever budget deficit in the country, adding more tension to the market.
As confidence in financial markets declined, investors were eager to find a safe haven in the dollar that surged to the highest level in a week, causing the gold to drop. Investors are turning away form basic commodities and high risk-high return securities.
Precious metals have gained from the better than expected report repot from Citi Group, which managed to cope with its high expenses from defaulted loans. Though, the rise was insignificant compared to the effect that the Goldman Sachs case wrought, as metals were forced to give up ground.
Asian markets are still occupied by cautiousness with the ongoing mortgage tightening policy in China, while losses in millions are being incurred by European airline companies as the Icelandic volcano ash blanket is still covering the Old Continent's skies.
Gold futures due June have risen by 0.05% as they are trading at $1136.40 at exactly 2:14 EST, while silver futures have risen to $17.800.
S&P GSCI closed yesterday at 524.89 loosing 9.28 points, while RJ/CRB dropped 3.06 points to 273.23.