Source:Marketwatch
San Francisco— Gold futures closed higher Friday to end the week nearly 5% higher, boosted by growing tension over Iran's nuclear activities as well as strength in oil from various threats to production.
Strong U.S. employment data lifted the dollar, providing earlier pressure on gold which then limited the precious metal's gains.
But platinum made the biggest gains among the precious metals this week, climbing 12% from last Friday's closing level on speculation over the launch of a platinum-based exchange-traded fund.
As for gold it "dipped in a knee-jerk reaction" to the employment report — "at least until the time when news of an Iranian missile test hit the wires and sent people back to the trading pits wishing to now buy," said Jon Nadler, an investment-products analyst at bullion dealers Kitco.com.
Iran reportedly continued with missile tests overnight. Tehran has started 10 days of military maneuvers across the country. The exercise comes as the United Nations continues to discuss sanctions against Iran for refusing to stop enriching uranium.
Against this backdrop, gold for December delivery rose by $1.40 to close at $629.20 an ounce on the New York Mercantile Exchange. After climbing a total of over $22 in three sessions, it ended the week 4.7%, or $28.20, above last Friday's closing level of $601.
Meanwhile, the dollar rallied against major currencies, touching one-week highs versus the yen and Swiss franc, after a government report showed the labor market is on fairly firm footing, damping expectations the Federal Reserve will lower interest rates soon.
Although U.S. non-farm payrolls grew by a lower-than-expected 92,000 in October, this was not the entire picture. The unemployment rate fell to 4.4%, the lowest level in more than five years, the Labor Department reported Friday.
Given the rally this week in gold, most analysts still expect gold prices to reach $1,000 and beyond, though not as early as some had previously expected.
"Gold has posted a strong performance this week, signaling the return of more bullish sentiment but a period of consolidation around $612 to $625 would be healthy, avoiding an overbought retracement and ensuring the longevity of the rally," said James Moore, an analyst at TheBullionDesk.com.
Platinum rally
Elsewhere in metals trading, January platinum closed up $45.20, or 3.9%, at $1,209.40 an ounce, after climbing 5.6% in the previous session.
Strong buying has helped lift the contract to its highest levels since Sept. 14 and the contract ended the week with a gain of $129.70, or 12%.
There has been speculation over the launch of a platinum exchange-traded fund, said James Moore, an analyst at TheBullionDesk.com.
"Funds have obviously been aggressive buyers over the past 24-hours and are looking to rebuild some long positions in the market after 2 1/2-months of reducing their net long exposure," he said.
"As well, the white metal still has very favorable fundamentals with the market still sitting on a small deficit due to increasing usage in diesel auto-cat[alysts]," he said.
Platinum's sister metal palladium saw its December contract climb $8.35 to close at $335.10 an ounce, up 3.7% for the week.
Rounding out action in the metals pit Friday, December silver futures fell 1.5 cents to finish at $12.635 an ounce, but it was 4.6% above last week's close.
And after climbing more than 5 cents on Thursday, December copper closed up 3.1 cents at $3.3225 a pound. It's finished down 2.4% from last Friday's closing level.
Copper supplies rose by 72 short tons to 23,174 short tons as of late Thursday, according to Nymex data. Gold inventories were unchanged at 7.53 million troy ounces and silver supplies were also flat at 105.9 million troy ounces.
In equities, metals-mining shares moved higher, ready to extend the modestly gains from the previous session.
The Philadelphia Gold and Silver Index was at 139.73, up 1.3% and the CBOE Gold Index added 1.7% to trade at 145.77. The Amex Gold Bugs Index climbed 1.5% to 327.81.
The DJ Wilshire Nonferrous Metals Index rose by 1.8% to stand at 5,098.26. The DJ Wilshire Industrial Metals Index was at 3,008.19, up 0.8%, and the DJ Wilshire General Mining Index climbed by 2% to 1,373.63.
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