adsense

Gold outlook seen bright dips 3 percent on dollar rise

Gold outlook seen bright dips 3 percent on dollar rise
mines,gold,silver,oil,gazz,coal,prices,market,asia, europa,america,africa

Gold fell 3 percent on Wednesday as the dollar rallied amid mounting worries about the global economy and Europe's worsening debt crisis, while this week's brutal correction also kept jittery investors at bay.


Silver dived 7 percent on sharply weaker commodity prices as crude oil and grains tumbled. Wall Street fell 2 percent on the commodities rout and news that bans on short-selling stocks in France, Italy and Spain had been extended.

Bullion, which staged a one-day rally on Tuesday along with commodities and equities, has lost around 10 percent in the past five sessions after a sharp margin increase and heavy selling by funds to cover losses in other markets.

Gold investors, however, are unconvinced that the sell-off has damaged the metal's safe-haven status.

"I don't look at it as anything more than a fairly stiff correction within a secular bull market in gold prices," said Mark Luschini, chief investment strategist at Janney Montgomery Scott, a broker-dealer with $54 billion in assets.

"The issues that are supporting gold haven't gone away," he said.

Spot gold was down 2.9 percent at $1,601.79 an ounce by 3:36 p.m. EDT.

U.S. gold futures for December delivery settled down $34.40 at $1,618.10 an ounce. Trading volume was weaker than this week's average, suggesting lower liquidity might have accelerated bullion's decline.

Silver sank 6.9 percent to $29.64 an ounce in choppy trade.

Silver has notched its second major retreat of the year this month, falling almost 30 percent so far in September.

Traders also cited heavy selling by hedge funds to dress up end-of-quarter performance.

INVESTMENT HOLDS FIRM

Gold's sharp correction has not yet unnerved investors in the No. 1 gold exchange-traded fund, SPDR Gold Trust. And there is no sign that gold futures and options investors are heading for the exit, data showed.

Saxo Bank senior manager Ole Hansen said gold's 200-day moving average, currently at $1,530 an ounce, should provide support.

"The only worry is obviously how burned investors have become from this 20 percent correction, as something which was perceived to be safe suddenly was not anymore," Hansen said. Strong physical demand from Asia should support the market at lower prices, dealers said.

Gold bar premiums in India, the world's biggest bullion consumer, hit their highest in more than a year, to top $2 an ounce, after prices fell from record highs. Premiums for gold bars elsewhere in Asia also rose.

Gold traded at an unprecedented $100 premium to platinum on Wednesday as risk aversion weighed on industrial precious metals while supporting bullion. More than half of platinum demand comes from industry.

Spot platinum was down 2.4 percent at $1,522 an ounce, while palladium fell 4.1 percent to $616.99 an ounce.

(Additional reporting by Jan Harvey in London and Lewa Pardomuan in Singapore; Editing by Marguerita Choy and Dale Hudson)....RESOURCES

No Response to "Gold outlook seen bright dips 3 percent on dollar rise"

Post a Comment

Submit Your Site To The Web's top 50 search engines for free!ArticleCity.comSonic Run: Internet Search EngineSearch EnginekrAdvertising BlogsBlogarama - The Blog Directoryhttp://www.wikio.comMIM - Free BacklinksBusiness Blogs - Blog RankingsLinkon Bedava - Free BacklinkFree BacklinksBusiness Blogs - Blog RankingsYour-LinkFree Backlink Exchange For SeoFree Automatic LinkMsn bot last visit powered by  Bots VisitYahoo bot last visit powered by  Bots Visit Google bot last visit powered by Bots Visit Add to Tagza.com: Social Bookmarking siteIndian Social bookmarking SiteTopOfBlogs eyword finde Feedage Grade A rated