Gold Moves Higher as Euro Hits New Low

by Andrew Burger | July 11, 2011 11:11 am

Spot gold jumped more than $7 an ounce, above $1,556, in early NY trading as EU debt crisis contagion hit Italy. Other news alo contributed to safe haven demand for the yellow metal as gold prices surged and mining stocks moved higher.

Spot gold prices were set at $1,555.50 at the London p.m. fix, $12 higher than the a.m. fix, and was trading at $1555.90 Bid, $1556.90 Ask in early NY trading.  Silver was set at $36.36 in London and was trading at $36.60 Bid, $36.70 Ask, according to Kitco[1] market data.

Gold prices hit a record high in euros of 1,090.49 as the European currency fell to a two-week low, the pound continued to weaken, and investors scrambled out of risky Italian, Portuguese and Spanish bonds to the relative safety of German bunds as EU finance ministers reportedly agreed to accept a partial default on Greek bonds and to double the size of the EU’s bailout fund.

High Chinese inflation and a weak U.S. jobs report on Friday were also fueling demand for gold, according to market reports.  Chinese inflation rose 6.4% in June, the highest in three years, a sign that Chinese monetary tightening would persist.

Turning to gold and silver stocks, the major gold ETFs were higher while the iShares Silver Trust (NYSE: SLV[2]) was trading lower.

• The SPDR Gold Trust (NYSE:GLD[3]) was up around 1.3 points, or nearly 0.9%.
• The iShares Gold Trust (NYSE:IAU[4]) was $0.12, 0.76%, higher.
• The iShares Silver Trust (NYSE:SLV[2]) was down between 0.3% and 0.5%.

Major gold miners were higher as a group, while junior gold and silver mining stocks moved lower in stock market trading on Monday morning.

• The Market Vectors Gold Miners ETF (NYSE:GDX[5]) was up more than 0.2%.
• The Market Vector Junior Gold Miners ETF (NYSE:GDXJ[6]) was around 0.5% lower.
• The Global X Silver Miners ETF (NYSE:SIL[7]) was trading more than 1-3/4% lower.

Major gold mining stocks were broadly higher, though NovaGold Resources

(AMEX:NG[8]) was off sharply on Monday.

• Agnico Eagle Mines (NYSE:AEM[9]) was trading up between 0.7% and 1%.
• Barrick Gold (NYSE:ABX[10]) was up between 0.2% and 0.3%.
• Goldcorp (NYSE:GG[11]) was up more than 1.1%.
• Newmont Mining Corp. (NYSE:NEM[12]) was trading up around 0.1%.
• NovaGold Resources (AMEX:NG[8]) was off more than 1.6%.

Silver mining shares were down sharply, amid signs of slowdowns in emerging market growth, as well as weakening outlooks for the EU and U.S. economies.

• Coeur D’Alene Mines Corp. (NYSE:CDE[13]) was down nearly 2.2%.
• Hecla Mining (NYSE:HL[14]) was trading nearly 2.4% lower.
• Pan American Silver Corp. (NASDAQ:PAAS[15]) was trading nearly 2.3% lower.
• Silver Wheaton Corp. (NYSE:SLW[16]) was around 2.1% lower.
• Silver Standard Resources Inc. (NASDAQ:SSRI[17]) was down nearly 1.6%.

As of this writing, Andrew Burger did not own a position in any of the stocks named here.

Source URL: https://investorplace.com/2011/07/record-gold-prices-euro-crisis/

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