Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold held virtually unchanged above $1,254 as rising oil and a stronger dollar spurred demand for risk assets. Silver gained another 1% to close at $17.14, extending yesterday's 4.4% surge.

Oil prices bounced 4% higher after U.S. government data showed a smaller surplus in stockpiles than expected. Speculation that major producers will try again next month to reach an agreement to curtail production also boosted prices.

Equities climbed on rising energy shares, with the Dow rising 0.5% to a fresh 2016 high and the Global Dow adding around half that much. Upbeat U.S. housing data also supported risk appetite, as existing-home sales rebounded 5.1% in March, helping to offset some of the gloom over yesterday's report that new-home starts fell to a one-year low.

The dollar rebounded against major rivals, with the ICE Dollar Index picking up 0.3% as traders position for the possibility of more easing talk out of the ECB when it meets later this week. While policy changes are not expected, traders anticipate pressure on the euro from verbal assurances that the central bank will "do whatever it takes," in Mario Draghi's words, to support the Eurozone economy.

The other precious metals finished solidly higher, with platinum and palladium gaining 1.2% and 2.6%, respectively. Like silver, the PMGs have broader applications for industry than gold, helping them to rise at times with equities on anticipated economic growth. Silver has now gained more than 24% this year, compared to 18% for gold, fueled by expectations for rising industrial demand.

At the Comex close: June gold inched up 10 cents $1,254.40; May silver added 16 cents, to $17.14; July platinum climbed $12.40 to $1,028.10; and June palladium jumped $14.90 to $597.05 an ounce.