Gold above $1,300/oz on lower shares, geopolitical concerns * Dollar little changed, European shares drift lower * Markets eye developments in Ukraine, Gaza strip Gold steadied above $1,300 an ounce on Monday, as European shares weakened and political tensions simmered after the downing of a Malaysian airliner in eastern Ukraine last week and incessant fighting in Gaza. Spot gold was up 0.3 percent to $1,314.19 an ounce at 0955 GMT, while U.S. gold futures for August delivery were up 0.4 percent at $1,314.70 an ounce. Gold jumped 1.4 percent last Thursday as some investors sought protection against any drop in equities after news of the loss of the Malaysian passenger plane. But participants quickly banked profits the following day, contributing to a 2 percent weekly fall in prices, the first weekly drop in seven. Some in the market reckon the jet disaster could help bring about a diplomatic solution to the worst crisis between Russia and the West since the Cold War. However, reports that Ukrainian forces were moving into the eastern city of Donetsk added to concerns that the conflict may instead escalate further. Meanwhile in the Middle East, Hamass armed wing said on Sunday it had captured an Israeli soldier, as fighting in Gaza led to the highest losses in a nearly two-week military offensive, with some 100 Palestinians and 13 Israeli soldiers killed. Today we are likely to remain in narrow range, with some buying coming in as traders watch the headlines on the geopolitical side, VTB Capital analyst Andrey Kryuchenkov said. Depending on the U.S. CPI data tomorrow, prices may test support at $1,295. In wider markets, the dollar stood unchanged against a basket of main currencies while European shares fell. The market will continue to monitor U.S. economic data after recent reports supported views that the worlds largest economy is on a steady recovery path, giving a boost to views that the Fed could raise U.S. interest rates sooner than expected. In a measure of investor sentiment, holdings of the SPDR Gold Trust, the worlds largest gold-backed exchange-traded fund, rose 1.8 tonnes to 805.14 tonnes on Friday. Speculators, however, cut bullish bets on gold futures and options in the week to July 15 for the first time in six weeks as prices fell. In other precious metals, palladium was up 0.3 percent at $878.90 an ounce on possible supply worries that could emanate from stricter sanctions on top producer Russia. Platinum was up 0.5 percent to $1,488.99 an ounce. The worlds biggest producer, Anglo American Platinum, said on Monday it planned to sell its Union mine, Rustenburg operations and a joint venture in South Africa, in a widely expected move after a five-month strike. Spot silver was up 0.4 percent to $20.92 an ounce.
Posted on: Mon, 21 Jul 2014 10:48:28 +0000
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