Gold ends Thurs 0.7% higher; subprime and inflation fears grow

From Chris Mullen at GoldSeek.com...

Gold Prices remained near unchanged on Thursday at about $672 in Asia before it found slight gains in London and morning New York trade.

The Gold Market then advanced its gains in afternoon US trade and ended right near its high of the session with a gain of 0.68% above $675 per ounce.

Silver traded on either side of unchanged for most of world trade before it also rose in afternoon New York trade and ended with a gain of 0.38%. The Euro Price of Gold rose over €490, platinum gained $2 to $1,320, palladium gained $4 to $369, and copper rose roughly 8 cents to about $3.66.

Gold and silver equities rose throughout the day and ended with about 2% gains. The StreetTracks GLD exchange-traded gold fund added 9.23 tonnes of gold to the bullion it holds in trust for investors happy to track the Price of Gold without owning it. The equivalent trust-based vehicle in Johannesburg added 0.24 tonnes to its holdings.

In the economy, Ben Bernanke finished his testimony before the senate and reiterated his concerns about subprime mortgages. Fed meeting minutes showed that FOMC members thought risks to economic growth were more balanced and "core inflation would remain relatively subdued but concurred that a sustained moderation in inflation had not yet been convincingly demonstrated."

After initial jobless claims for last week showed a decline – and both the Philadelphia and Leading Indicators indices came in well below forecast – there are no major economic reports due out today.

Back in Thursday's markets, oil added over 1% more to Weds's gains in further reaction to the poor US inventory reports as newly reported 11.9% GDP growth in China that indicates continued strong demand.

The US Dollar index rose slightly and Treasury bond prices dipped despite poor those economic data and continued subprime worries, as traders decided to book profits from the recent run.

The Dow, Nasdaq, and S&P rose on mostly strong earnings reports despite notable weakness in financial stocks. In the gold sector, NovaGold saw its lawsuit against Barrick dismissed, Royal Gold reported a royalty from its Taparko Mine and Centerra Gold made a new production forecast.