Gold sets another record
Despite some selling and a stronger US dollar, gold prices inched higher after a jump in initial jobless claims.
By Alix Steel, TheStreet
Updated at 4:39 p.m. ET
Gold for December delivery settled $4.20 to $1,296.30 an ounce at the Comex division of the New York Mercantile Exchange. Gold Thursday has traded as high as $1,297.50 and as low as $1,288.20.
Stocks began to sell off near the end of the day, and the Dow Jones Industrial Average ($INDU) ended up losing 77 points to 10,662. The S&P 500 ($INX) closed 9 points lower to 1,125, and the Nasdaq ($COMPX) dropped 7 points to finish at 2,327.
The U.S. dollar index was rallying 0.2% to $79.96, while the euro was losing 0.4% to 1.33 against the dollar. The spot gold price was up $1.80, according to Kitco's gold index.
After gold reached a new intraday high Wednesday of $1,298 an ounce, some investors were selling their positions to take profits. But a jump in weekly initial jobless claims to 465,000 helped to support prices.
Experts predict that gold will break $1,300 relatively soon as the buying frenzy is backed up by global currency concerns.
The Bank of Japan's recent intervention in the currency market to help the yen drop in value wasn't enough, and rumors are that the central bank will have to intervene again to force the yen lower.
The news, coupled with the growing consensus that the Federal Reserve will begin another round of monetary easing soon, highlights the fragility of paper currencies and makes gold all the more appealing as a safer form of money.
The dollar was rebounding slightly Thursday on the back of a weaker euro. The euro was struggling after September's eurozone manufacturing purchasing managers index came in weaker than expected at 53.60, led by a disappointing number out of Germany.
A stronger dollar makes gold, which is priced in the currency, more expensive to buy elsewhere. But for the long term, most analysts expect the U.S. currency to struggle.
"The . . . weaker dollar . . . will continue to provide background support," James Moore, an analyst at thebulliondesk.com, said in his daily metals report.
At the Denver Gold Forum this week, the CEOs of the major silver and gold mining companies said gold will head higher, with price targets anywhere from $1,500 to $2,500 in the next three to five years. But some warned that a correction might hit the market in the short term.
"I think we have many years left in this cycle," said Bradford Cooke, the CEO of Endeavour Silver (EXK), but "it's time for a pullback. We're way overdue for a summer correction, . . . and I think that pullback is starting right away."
Silver prices settled up 16 cents at $21.21 per ounce, while copper closed up 3 cents at $3.59 per pound.
Gold mining stocks, a risky but potentially profitable way to buy gold, closed mostly lower Thursday. Barrick Gold (ABX) lost 1.1% to $46.71 and Newmont Mining (NEM) was 1.7% lower at $63.85. Randgold Resources (GOLD) fell 1.4% to $101.30 while AngloGold Ashanti (AU) finished flat at $45.85.
Copyright © 2013 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
[BRIEFING.COM] A solid November employment report translated into a solid day of gains for the major averages. While there was some talk that the encouraging job growth raised the odds of the Fed announcing a tapering at its December meeting, the message of the markets today was either that it didn't believe there would be a tapering this month or that it doesn't fear a tapering this month.
It was just one day, yet there was ample meaning wrapped up in the connection that the 10-yr ... More
More Market News
|There’s a problem getting this information right now. Please try again later.|
LATEST MARKET DISPATCHES
- No more Dispatches; here's where to find market news
The Market Dispatches column has been discontinued. Here's where to find the latest stock and business news on MSN Money, and the latest from market writer Charley Blaine.
- Dow falls 59 as late-day gloom kills a rally
- Stocks held back by fiscal-cliff worries
- Stocks suffer worst weekly loss in 5 months
- Dow off 121 as post-election swoon continues
- Dow slumps 313 after Obama's re-election
- Dow jumps 133 as Americans head to the polls
The Fed may start tapering in just a few months. Here are a few of the likely winners and losers.