Daily Gold Update

Source: Reuters

New York— COMEX gold closed higher after a weak start on Thursday, as the euro rallied toward its high against the dollar and the Dow Jones retreated.

June gold settled $4.40 higher at $369.60 an ounce. It swung from the overnight low of $360.20, failing to break Wednesday�s low of $358.60, to a high of $370.

�It�s all dollar-related,� said another gold trader. �There was some fund buying around as well. It�s all part of the same trade�guys are long euro, long gold.�

Precious metals markets have been volatile this week as gold rose to a near four-month high of $375, before declining $17.

Speculators on the COMEX were also rolling out or liquidating long positions in the June gold contract before delivery notices start on Friday. Estimated volume was 105,000 lots, including 9,833 switches, mostly June to August.

New York Spot gold closed at $370.30, up from $364.75/5.45 late on Wednesday. London�s late fix was $363.10.

The euro rose to $1.1904, just short of Tuesday�s lifetime high at $1.1925, and traded at $1.1862/66 in the afternoon, up from the close at $1.1755/61.

The recovery in the euro started after the U.S. government reported that weekly claims for unemployment benefits dipped to 424,000 last week from 433,000 and that first quarter gross domestic product expanded at a 1.9 percent annual rate, compared with last month�s estimated advance of 1.6 percent.

But with the number of people continuing to draw claims stuck above 400,000 for three months, the market was cool to the numbers, buzzing about a �jobless recovery.�

The Dow Jones industrial average fell 0.93 percent after opening higher.

On Tuesday, gold hit $375 an ounce, its highest level since Feb. 7, as the euro topped its debut price on January 1999.

Gold tumbled under the weight of the speculative long positions built up in the rally from $320 six weeks ago, traders said.

Speculators were nearly as overbought as in early February, when the weak dollar and prewar safe-haven buying drove gold futures to 6-1/2 year highs above $390 an ounce.

July silver 0#SI: fell 6.5 cents to $4.575 an ounce, trading at $4.65-$4.54, its lowest since April 21. Spot silver XAG= closed at $4.56/58, down from $4.63/65 late on Wednesday. The fix was at $4.61.

NYMEX July platinum 0#PL: dropped $28.80 to $633.90 an ounce, hitting a three-week low at $630. Spot XPT= was indicated at $638.00/643.00.The selling came from Japanese investors and hedge funds. Commercial buying had kicked in by the time New York opened.

�Stop losses were triggered. Platinum was leveraged to the long side, it�s no secret, especially in Japan,� he said. �One surprise is with lease rates so high, it fell so hard.�

One-month platinum lease rates were last around 20 percent, down from 21 percent on Wednesday, but up from an overnight low at 16 percent.

June palladium 0#PA: closed down $3 $182.15 an ounce. Spot XPD= fetched $178.50/184.50.