ANL 11.20 Decreased By ▼ -0.25 (-2.18%)
ASC 9.71 Decreased By ▼ -0.09 (-0.92%)
ASL 12.00 Increased By ▲ 0.65 (5.73%)
AVN 80.00 Increased By ▲ 1.70 (2.17%)
BOP 5.94 Increased By ▲ 0.11 (1.89%)
CNERGY 5.70 Increased By ▲ 0.16 (2.89%)
FFL 6.85 Decreased By ▼ -0.12 (-1.72%)
FNEL 6.26 Increased By ▲ 0.11 (1.79%)
GGGL 12.10 Decreased By ▼ -0.05 (-0.41%)
GGL 16.89 Increased By ▲ 0.07 (0.42%)
GTECH 9.45 Decreased By ▼ -0.20 (-2.07%)
HUMNL 7.00 Increased By ▲ 0.35 (5.26%)
KEL 2.68 Increased By ▲ 0.12 (4.69%)
KOSM 3.09 Increased By ▲ 0.09 (3%)
MLCF 27.50 Increased By ▲ 0.25 (0.92%)
PACE 3.09 Decreased By ▼ -0.01 (-0.32%)
PIBTL 5.99 Decreased By ▼ -0.12 (-1.96%)
PRL 17.58 Decreased By ▼ -0.30 (-1.68%)
PTC 7.62 Decreased By ▼ -0.53 (-6.5%)
SILK 1.29 Decreased By ▼ -0.14 (-9.79%)
SNGP 27.40 Increased By ▲ 1.31 (5.02%)
TELE 11.64 Decreased By ▼ -0.12 (-1.02%)
TPL 9.90 Increased By ▲ 0.01 (0.1%)
TPLP 18.62 Increased By ▲ 0.94 (5.32%)
TREET 29.70 Decreased By ▼ -0.40 (-1.33%)
TRG 81.11 Decreased By ▼ -0.57 (-0.7%)
UNITY 22.48 Decreased By ▼ -0.79 (-3.39%)
WAVES 13.45 Decreased By ▼ -0.05 (-0.37%)
WTL 1.56 Decreased By ▼ -0.04 (-2.5%)
YOUW 5.09 Decreased By ▼ -0.01 (-0.2%)
BR100 4,262 Increased By 29.5 (0.7%)
BR30 15,499 Increased By 12.7 (0.08%)
KSE100 42,861 Increased By 319.7 (0.75%)
KSE30 16,276 Increased By 133.1 (0.82%)

GoldLONDON: Gold was set for a third daily rise on Tuesday, after a retreat in the dollar helped reverse earlier losses, while concern about Greece's debt crisis was expected to insulate the price from any severe declines.

A sharp rise in margins on US oil futures dented the broader commodities complex but with so much investor focus on Greece and other indebted euro zone member states, gold was able to rally for a third day.

The oil margin hike came on the heels of consecutive margin increases on the COMEX silver futures in the past two weeks, which knocked silver prices down more than 25 percent last week and triggered a broad sell-off in commodities.

The euro edged higher, Greek government bond yields fell and safe-haven German Bund prices retreated on Tuesday on talk that a new aid deal for Athens could be in place as soon as next month.

But the fragility of Greece's finances as well as the impact of more potential bailouts for other indebted euro zone members was expected to support gold, in spite of a continued decline in global holdings of the metal in exchange-traded funds.

Spot gold recovered from a session low of $1,505.69 an ounce to be quoted 0.1 percent higher at $1,514.60 by 1110 GMT, set for a 1.5 percent gain this week.

COMEX gold edged up 0.8 percent to $1,515.00.

"This news this morning on the Greek debt situation and the dollar are balanceing the market, so the gold price isn't moving very much," said Commerzbank analyst Daniel Briesemann.

"We have seen a couple of (ETF) outflows over the last few days and this might have dragged the gold price down a little but the decrease we've seen over the last week isn't realated to anything specific on gold," he said.

GOLD HIT BY ROUT

Gold fell by more than 4.5 percent last week in its largest weekly slide in two years, caught up in a storm of selling that battered the entire commodity complex.

Global ETF holdings of gold have fallen to their lowest level this year, reflecting some of the investor push out of commodities in the last couple of weeks, and particulary last week when raw materials prices staged their biggest weekly since since late 2008.

Brent oil dropped $2 on Tuesday after a 25 percent margin hike on US oil futures but later recovered to show just a 0.5 percent loss on the day.

"The margin hike decreases the bullish sentiment in the commodities market," said Ong Yi Ling, an analyst at Phillip Futures, adding that gold could drop towards $1,500.

Reflecting the discomfort among investors over Greek debt, gold priced in euros rose by 0.3 percent to 1,056.26 euros an ounce, nearing recent four-month highs above 1,060 euros. Euro-denominated gold rose by nearly 40 percent last year, when investors fled euro-priced assets as the region's debt crisis unfolded.

"While some sense of normality has been restored to precious metals markets following last week's beating, volumes are very light and as such the potential for exaggerated price moves is quite high," said UBS strategist Edel Tully.

"Gold looks quite comfortable at $1,500, and would profit from any escalation in concerns over Greece's debt sustainability. In this climate it is also worth paying attention to the euro price of gold," she said.

Spot silver reversed earlier losses and rose 1.3 percent to $38.39 an ounce, after posting a 6-percent rally in the previous session, its biggest one-day rise in six months.

COMEX silver rallied 4 percent to $38.58 an ounce.

Investors are watching China's inflation data, due Wednesday, which may shed light on if and how Beijing will further tighten up its monetary policy.  Platinum and palladium rose in line with gold and silver, with platinum up 0.3 percent at $1,794.74 an ounce, while palladium rose 0.7 percent to $731.22 an ounce.

COPYRIGHT REUTERS, 2011

Comments

Comments are closed.