Gold News

Gold Ends Weds 0.6% Higher as Dollar Wobbles, Gustav Nears US Oil Installations

From Chris Mullen at

Gold rose over 1.5% to $834.90 by midday in London on Wednesday before it fell to a tiny loss at $822.45 in New York.

Gold then rallied back higher by the US close and ended with a gain of 0.65% for the day.

Hurricane Gustav became Tropical Storm Gustav as it lost steam crossing
over Haiti, but forecast models call for it to turn back into a
hurricane as it enters the Gulf of Mexico and most predictions now call
for it to head straight into many oil and natural gas rigs.

Many energy companies are already evacuating installations as a
precaution and rigs are already shutting down, but the question now is
what long term damage, if any, will occur, and how soon will these rigs
get back into production after the hurricane passes.

If no major damage is done and the Gulf of Mexico remains calm after,
then most rigs could likely be back into production within a week, but
crude oil rose on these storm threats nevertheless while traders also
had to factor in Wednesday’s US inventory stockpile report showing that
crude inventories fell 100,000 barrels, gasoline inventories fell 1.2
million barrels, and distillates remained unchanged.

The US Dollar index fell over night as the Euro rose on hawkish
comments from the European Central Bank’s Axel Weber. A
stronger-than-forecast US durable goods report then took the index well
off its lows and it ended with just a modest loss.

Treasuries ended higher after a strong 2-year note auction. The Dow,
Nasdaq, and S&P rose on the better than expected durable goods data and
hopes that a bailout of Fannie and Freddie may no longer be necessary.

Silver rose over 2% to $13.86 and fell $13.39 before it also rallied back higher, but it still ended with a loss of 0.52%.

The Gold Price in Euros rose to about €563, platinum gained $20.50 to $1437, and copper rose a few cents to about $3.47.

Gold and silver equities rose over 2% at the open before they fell back
near unchanged midday, but they then rallied back higher into the close
and ended with about 2% gains.

Chris Mullen is chief content manager of the GoldSeek family of websites, a leading source of gold news, comment and mining-stock data for private and institutional investors.

See the full archive of Chris Mullen articles


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