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4 years ago
PRECIOUS-Gold extends gains as stocks tumble, dollar falls
June 13, 2013 / 3:16 AM / 4 years ago

PRECIOUS-Gold extends gains as stocks tumble, dollar falls

4 Min Read

* Gold up after 0.6-pct gain on Weds
    * Asian stocks fall sharply, dollar hits 10-wk lows
    * Gold also supported as China returns from holiday

 (Updates prices)
    By A. Ananthalakshmi
    SINGAPORE, June 13 (Reuters) - Gold extended gains into a
second session on Thursday, as Asian stock markets fell sharply
and the U.S dollar dropped to a 10-week low on persistent
uncertainty over the Federal Reserve's massive stimulus
    Investors were still weighing the Bank of Japan's decision
on Tuesday to leave its policies unchanged and Standard & Poor's
Monday upgrade of the U.S. credit outlook, viewing the moves as
a sign of economic recovery and a trigger for the Fed to end its
$85-billion monthly bond purchases.
    "The sentiment is still very divided over whether the Fed
will taper or not," said Joyce Liu, an investment analyst at
Phillip Futures in Singapore.
    "Due to the lack of major market-moving events, people are
just trading on technicals until some senior Fed officials say
something before the FOMC meeting next week," she said,
referring to the Federal Open Market Committee. 
    Markets will watch the policy meeting on June 18 and 19 for
clues on the timing of a rollback of stimulus measures. Fed
officials are divided over their ultra-easy monetary policy and
some warn it could stoke future inflation and financial
    Most economists expect the Fed to scale back the size of its
bond purchases by the end of the year, and several expect
reduced buying as early as September, a Reuters poll showed.
    Spot gold had climbed 0.2 percent to $1,390.36 an
ounce by 0634 GMT. It closed up on Wednesday after earlier
losses, as U.S. stock markets dropped sharply. 
    U.S. gold fell about $2 to $1,390.10.
    Spot gold is expected to test resistance at $1,402 per
ounce, a break above which would lead to a further gain to
$1,410, Reuters technical analyst Wang Tao said. 
    Demand from major buyer China, which returned from a
three-day holiday on Thursday, also propped up gold prices.
    China has been a big factor in holding up gold prices, even
as demand in India, the biggest buyer of the precious metal, has
cooled and investors have dumped holdings in exchange-traded
    Gold fell during Asian trading sessions this week due to the
lack of buying from the second-largest consumer of bullion. 
    Indian gold demand remained subdued, and importers and
wholesalers struggled to sell supplies from May. The government
has raised the import duty on gold by a third and curbed gold
financing by banks and others in an effort to cut its current
account deficit. 
    Net gold imports into India have fallen from an average of
$135 million in the first half of May to $36 million in the
second half, Finance Minister P. Chidambaram said on Thursday.

  Precious metals prices 0634 GMT
  Metal             Last    Change  Pct chg  YTD pct chg    Volume
  Spot Gold        1390.36    2.57   +0.19    -16.97
  Spot Silver        21.86    0.01   +0.05    -27.81
  Spot Platinum    1470.24   -8.26   -0.56     -4.22
  Spot Palladium    753.22   -0.78   -0.10      8.85
  COMEX GOLD AUG3  1390.10   -1.90   -0.14    -17.05        20177
  COMEX SILVER JUL3  --        --      --       --          
  Euro/Dollar       1.3383
  Dollar/Yen         94.08
  COMEX gold and silver contracts show the most active months
 (Reporting by A. Ananthalakshmi; Editing by Clarence Fernandez
and Joseph Radford)

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