Gold futures gained $15 throughout Friday’s session reaching highs of $1,013, setting the gold market up for its fourth successive weekly gain. The gold market rally has gathered pace over recent sessions after Tuesday saw the yellow metal brake above the key $1,000 dollar mark.
Analysts were keenly focusing on European and North American gold trading this morning. With the Gold price’s strong performance in September so far, analysts felt that some profit-taking may dampen the rally particularly from institutional investors. With a close above $1,000 today crucial for a sustained rally through next week, the Gold price is continuing to become an attractive asset class for investors.
This afternoon’s $15 jump comes as gold becomes increasingly influenced by the weakness of the US Dollar, which extended losses this afternoon following the announcement of the consumer sentiment survey. Standing at 77, the ICE Futures U.S. Dollar Index (USDX®) is currently making yearly lows, apparently fuelled further by a survey conducted by the University of Michigan showing that consumer sentiment in the US rose to 70.2 for September - a better than expected improvement from last month.
Gold futures have been strong through each global exchange this Friday, following a strong Asian session overnight. The Asian session saw gold’s continuing rally gain further impetus following better than expected Chinese economic data, applying further pressure on the US dollar as foreign exchange (FX) investors favour higher risk, and higher yielding currencies. The weaker dollar pushed Gold Futures to $1,004.
In the People’s Republic of China (PRC) the National Bureau of Statistics announced today that China's industrial output is gathering pace, growing 12.3 percent in August from a year before, an increase of more than 10% percent over July. Retail sales also continued to grow, rising 15.4 percent higher in August year-on-year. The growth figure for July year-on-year was 15.2 percent.
The Chinese date exceeded expectations and adds to a growing view that global demand has been building over recent months and may continue to support the on-going economic recovery.
The Chinese announcement triggered a Dollar sell-off in Japanese Forex markets, as investors began returning to risk, selling their ‘safe’ US dollars against higher yielding currencies. The US Dollar extended September’s decline falling to a seven month low against the Japanese Yen.
In UK equity markets, gold stocks have been following the gold price making continuing gains through the week.
International gold miner Randgold Resources (LSE:RRS) traded as high as £43.98 following a strong day that’s seen the stock rise over 3%, in the FTSE 250 Peter Hambro Mining (LSE:POG) gained more than 2%, whilst Canadian-based Yamana Gold (LSE:YAU) were positive on the day also gaining 3.5%.
In the junior market, AIM listed gold explorers and producers have had a strong start to the day also. Allied Gold (AIM: ALGD, ASX: ALD) was one of the best performers following positive drill results, climbing 8%. Philippines focused Medusa Mining (AIM & ASX: MML) also did well, rising 6.5% as did Mwana Africa (LSE MWA) and Norseman Gold (AIM: ASX: NGL).
Sunday 13 September 2009
Gold Stocks Randgold Resources and Yamana Gold Trade Higher as Gold Hits $1,013
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