Grandich manages to get quoted again on capping of gold price

Section:

Gold Futures Post Modest Gain

By Myra P. Saefong and Polya Lesova
MarketWatch.com
Thursday, August 2, 2007

http://www.marketwatch.com/news/story/gold-futures-post-modest-gain/stor...

SAN FRANCISCO -- Gold futures posted a modest gain Thursday, closing below $680 an ounce for a sixth session in a row as traders remained cautious against a backdrop of recent credit-related jitters on global equity markets.

"Bullion prices spent the day in a decidedly undecided mode and were trapped in a six-dollar range as well as marked by lackluster participation," said Jon Nadler, an analyst at Kitco Bullion Dealers, in a note to clients.

Gold for December delivery tacked on 70 cents to close at $676.60 an ounce on the New York Mercantile Exchange, retreating a bit from an earlier high of $678.80. The contract hasn't been able to close above $680 since July 25.

Even so, "the gold bears have thrown everything at gold including the kitchen sink, but can only get it to bend," said Peter Grandich, editor of the Grandich Letter, in e-mailed comments. "At the end of the day, gold is the ultimate currency and that's why we see great physical demand despite an obvious capping of gold by the bears."

On Wednesday, gold futures fell $3.40 to close at $675.90 an ounce, pressured by a steep drop in oil prices and some strength in the U.S. dollar as the U.S. stock market shook off earlier weakness.

"The outlook is still rather mixed at the moment as traders remain cautious given the current credit market and sub-prime worries which are leading investors to increase their interest in government Treasuries," said James Moore, analyst at TheBullionDesk.com, in a research report.

"For the moment we still see gold trading largely sideways in a broad range between $650-$675, but we remain bullish longer-term and expect gold to resume its upwards push once the market moves out of the summer months and physical demand begins to pick-up," Moore said.

Other metals prices closed on a mixed note. September silver rose 4 cents to finish at $12.995 an ounce and October platinum gained $8.10 to end at $1,299 an ounce.

But September copper fell by 1.2 to close at $3.573 a pound and September palladium fell $2 to close at $366.30 an ounce.

In the backdrop, the dollar edged higher against the yen, extending gains from the previous session as a rebound in global equity markets encouraged a return of risk appetite. See Currencies.

Meanwhile, crude-oil futures closed higher as traders digested the latest U.S. supply data and comments from a key oil producer. The September contract had touched a record intraday level on Wednesday, but failed to close at an all-time high for a benchmark contract.

U.S. stocks gained Thursday, with upbeat results from Nokia and Starbucks helping setting the stage for gains in a market volatile amid credit jitters and generally strong corporate earnings.

"Gold has tracked stock markets this week, which remain jittery amidst lingering concerns about the possible fallout from problems in the U.S. subprime mortgage sector," said analysts at Action Economics. "However, some feel that gold has already done enough on the downside for now."

Gold warehouse inventories rose by 21,841 troy ounces to stand at 7.15 million troy ounces as of late Wednesday, according to Nymex data. Silver supplies rose by 600,609 troy ounces to 132.7 million troy ounces and copper supplies stood at 21,767 short tons, down 112 short tons. ...

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