QMX Gold Corp. (fka QMXGF)

[the cork]

1354.90 - Gold Drops,
Trimming Weekly Climb, as Strengthening Dollar Erodes Demand
By Nicholas Larkin and Wendy Pugh - Nov 26, 2010 5:09 AM PT

Gold declined in New York, paring a weekly gain, as a stronger dollar curbed demand for the metal as an alternative investment. Other precious metals dropped.

The dollar gained against the yen as North Korea’s state- run Korean Central News Agency said planned naval exercises by South Korea and the U.S. moved the peninsula “closer to the brink of war.” The greenback rose to a two-month high versus the euro amid concerns Europe’s sovereign-debt burdens are worsening. Gold, which reached a record $1,424.30 an ounce on Nov. 9, usually moves inversely to the U.S. currency.

“Bullion prices have been under pressure as a result of the decline in risk sentiment,” James Moore, an analyst at TheBullionDesk.com in London, said in a report. Still, gold may “remain underpinned by investment bargain hunting as investors look to diversify against the volatile macro-economic and geopolitical background.”

Gold futures for February delivery lost $13.60, or 1 percent, to $1,361.40 an ounce at 8:01 a.m. on the Comex in New York. Prices are up 0.7 percent this week. Floor trading was closed yesterday for Thanksgiving in the U.S. and electronic trades are booked with today’s for settlement purposes. The metal for immediate delivery in London was 1.1 percent lower at $1,360.60.

Bullion fell to $1,366.50 an ounce in the morning “fixing” in London, used by some mining companies to sell output, from $1,373.25 at yesterday’s afternoon fixing.

Irish Bailout

Borrowing costs for the euro region’s most-indebted nations are surging as Ireland’s acceptance of a bailout of its banking industry stokes speculation that other countries will have to seek aid. The Financial Times Deutschland reported that euro- area policy makers are pushing Portugal to seek assistance from a 750 billion-euro ($991 billion) bailout fund. The country isn’t being pressed to use the facility, an official at the office of Prime Minister Jose Socrates said.

Irish Finance Minister Brian Lenihan said yesterday that while the size of a bailout from the European Union and the International Monetary Fund hasn’t yet been determined, an amount of around 85 billion euros “has been mentioned.” The government said this week it will cut spending by about 20 percent and raise taxes over the next four years.

“We are following the euro to a certain extent and the euro is back to its weak point,” said Darren Heathcote, head of trading at Investec Bank (Australia) Ltd. The Korean conflict “is still in the back of people’s minds. There’s a possibility of further conflict and that is helping to support gold.”

‘Escalated Confrontation’

President Barack Obama has dispatched an aircraft carrier to take part in military drills in the Yellow Sea in a show of strength after North Korea this week shelled a South Korean island. North Korea warned that any “escalated confrontation” will lead to war, KCNA said in an e-mailed statement.

Explosive shots, coming from the direction of North Korea, were heard on South Korea’s Yeonpyeong Island today, said a spokesman at South Korea’s Joint Chiefs of Staff who declined to be identified, citing military policy. The military is investigating, he said.

Eleven of 15 traders, investors and analysts surveyed by Bloomberg, or 73 percent, said the metal will rise next week. One forecast lower prices and three were neutral.

Silver for March delivery in New York slid 3.1 percent to $26.75 an ounce. It reached a 30-year high of $29.34 on Nov. 9 and is up 59 percent this year.

Platinum for January delivery was 0.9 percent lower at $1,643.20 an ounce. Palladium for March delivery dropped 4.1 percent to $669.10 an ounce.

http://www.bloomberg.com/news/2010-11-26/gold-may-drop-trim-weekly-advance-on-concern-europe-debt-woes-to-spread.html