Gold futures top $700 for first time in almost 26 years Tuesday May 9, 11:58 am ET By Myra P. Saefong
Gold at nearly 26-year high as Iran optimism fades, U.S. dollar weakens
SAN FRANCISCO (MarketWatch) -- Gold futures climbed above $700 an ounce Tuesday for the first time since October of 1980 after hopes for resolution over Iran's nuclear program faded and the U.S. dollar weakened, prompting investors to seek refuge among the precious metals.
"Gold ... thrives on uncertainty," said Jon Nadler, an investment products analyst at bullion dealers Kitco.com.
"While one can always mitigate risk to a certain extent (with efficient portfolio hedges), one cannot as successfully hedge for uncertainty and the impacts of same on conventional portfolios," he said. "That is precisely the time when gold shows its long-established attributes best."
Gold for June delivery climbed as high as $700.50 an ounce on the New York Mercantile Exchange, the highest futures level in almost 26 years, according to montly charts. The contract was last up $20.40, or 3%, at $700.30. Prices closed lower for the first time in seven sessions Monday, as traders locked in some of the metal's recent sharp gains.
Gold prices have climbed $29 since the beginning of May alone, propelled higher by a now familiar list of factors, including inflation fears, geopolitical worry, a weaker dollar and burgeoning demand from investment funds seeking better returns than are currently available in other asset classes.
Citigroup believes investors held commodity positions worth more than $120 billion April, with $30 billion in oil and $30 billion in gas. Gold came in third place at $13 billion, while the long position in copper stood at $4 billion, according to Investec Securities.
"As most people have dollar denominated assets, the quest for portfolio preservation is becoming a priority and chasing profits for the sake of pure return is taking a back seat until the skies clear," said Nadler.
Iran musings Meanwhile, U.S. Secretary of State Condoleezza Rice said a letter from Iranian President Mahmoud Ahmadinejad -- Iran's first communication with the U.S. in 27 years - contained nothing new in the way of proposals that might help break the nuclear stalemate with the West, the Associated Press reported. While details of the letter have not yet been released, it is understood to criticize Bush for the Iraq invasion and for his handling of the Sept. 11 attacks on the U.S., among other things, AP said.
"Overnight it became clear that, as had been suspected, the written message from Tehran to the White House contained not much more than platitudes and criticisms," said Nadler. "Thus, the U.S. administration is downplaying the episode and its significance, while the U.N. continues to be mired in inaction."
Ministers came away from a meeting of the U.N. Security Council with Russia and China refusing to back the resolution favored by France, the U.S. and the U.K., that would open the door to trade sanctions against Tehran, according to news reports.
Gold's journey The pace at which gold prices have been expanding has been surprising, said Matthew Parry, an economist at Moody's Economy.com. He emphasized, however, that his company "does not ... envisage the current bull-run having much further to go once $700 has been broken."
"Assuming the recent escalation of geopolitical tensions subsides going forward, and global inflation comes under control, the price of gold should return to negative territory, falling back below $600 in 2007 as numerous new supply projects are expected to come on-stream," he said.
On the other hand, there is an "alternative upside-pricing scenario," he said.
"If the U.S. was to leads a military attack on Iran then we would enter doomsday territory, and the markets would put renewed faith in gold's alternative asset status," Parry said.
"Under such a scenario we would not be at all surprised in gold prices tested quadruple figures," he said.
Other metals futures headed higher along with gold Tuesday.
July silver futures were last up 59 cents, or 4.3%, at $14.36 an ounce and July copper rose 7.15 cents, or 2%, to $3.573 an ounce after a record $3.576.
July platinum galloped to a new record at $1,239.50 an ounce, up $37.60, while June palladium rose $18.75 to $394 an ounce ahead of Johnson Matthey's annual review of the platinum and palladium market, scheduled for release on Monday.
On the supply side, gold inventories were down 23,484 troy ounces at 7.63 million as of late Monday, according to Nymex data. Silver supplies rose by 592,836 troy ounces to 124.2 million. Copper fell 326 short tons to 14,876 short tons.
Tracking the metals equities Tuesday, the Amex Gold Bugs Index climbed to 389.15, up 3.5%, and the Philadelphia Gold and Silver Index (TSX VENTURE:XAU.V - News) rose to 165.66, up 3.3%.
The CBOE Gold Index (CBOE:^GOX - News) reached 168.41, up 3.3%, with shares of Freeport-McMoRan Copper and Gold (NYSE:FCX - News) up 3.7% at $69.06 and Coeur d'Alene Mines (NYSE:CDE - News) trading at $6.37, up 5.5%.
一共是四個數字，如果看不清楚，請重新整理