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SAN FRANCISCO (MarketWatch) -- Gold futures gained almost $5 an ounce for the week and silver prices ended at a 19-year high, up nearly 8% from last Friday's close as physical and investment demand remained strong.
At the same time, copper closed at a record level and platinum ended at levels not seen since 1980 and close to it highest futures level ever recorded.
"In a world where news stories continue to make ominous ripples, gold is acting like the thermometer of collective global anxiety," said Jon Nadler, an investment products analyst at bullion dealers Kitco.com.
"The victory of Hamas in the recent [Palestinian] elections, the possible transition of Israeli leadership...and the deepening ramifications of recent U.S. political debacles all have investors with one eye on the exit door from paper (toward liquidity) and (at least) one hand firmly grasping a gold bar -- just in case," he said.
Gold for February delivery climbed to a high of $564.50 an ounce on the New York Mercantile Exchange, nearing the 25-year intraday high of $568.50 established a week ago. The contract closed down $1.10 at $558.80 -- up $4.80, or 0.9% for the week.
April gold closed at $563.70, down $1.30, or 0.2%, for the day.
Friday's weak U.S. economic-growth report, which also showed higher-than-expected inflationary data, "continues to add to the list of negatives for the U.S. dollar," said Peter Spina, an analyst at GoldForecaster.com.
Growth in the economy slowed dramatically to a 1.1% annual rate in the fourth quarter, the weakest growth seen in three years, the Commerce Department reported. See full story.
"It is just a matter of time before we have another leg down in the U.S. dollar and this will just add to the luster of gold and silver," Spina said.
Driving force
Essentially, "the driving force behind the gold price this week has been lack of selling -- combined with the steadily growing investment demand, particularly from the exchange-traded funds," said Julian Phillips, an analyst at GoldForecaster.com.
"These forces should continue to push the gold prices, next week," he said.
Even so, it's important to note that "investors are losing focus of the main fundamentals that are driving this bull market," said Emanuel Balarie, senior market strategist at Wisdom Financial.
"Gold has posted new highs in the midst of inflationary concerns and increased global demand," he said, noting that he expects "this trend to continue for years to come, as a teetering U.S. economy and the global demand for an alternate 'currency'."
Looking ahead, he expects "gold prices to consistently post new highs in 2006."
Silver set for $10?
Meanwhile, March silver closed unchanged at $9.605 an ounce, easing back from its $9.75 high. Prices haven't traded at levels this high since 1987.
"The main driver continues to be the silver ETF and this is taking [silver] to fresh 19-year highs," said Peter Spina, an analyst at GoldForcaster.com.
The planned exchange-traded fund investing in silver from Barclays Global Investors moved closer to gaining regulatory approval, according to media reports this week.
Spina warned that while silver prices are moving higher in anticipation of the launch, once the ETF hits the markets, silver prices may initially retreat.
For now, "technicals for silver remain overbought, but momentum is keeping the run alive," he said.
From here, "profit taking should be expected as silver approaches the $10 mark -- with pullbacks finding willing buyers," he said, warning of continuing volatility in the silver market.
Copper, platinum at new highs
Also on Nymex, physical demand for copper and platinum pulled prices higher to close out the week.
March copper added 3.15 cents to close at $2.233 a pound after touching at a record $2.2375 earlier. It was up 6.8% for the week.
April platinum traded at a 26-year high of $1,078.90 an ounce, before closing up $7.60 at $1,072.70 for the session -- up 3.5% from the week-ago close. The record for a front-month contract is $1,085 from March 1980, according to Nymex.
Platinum's sister metal palladium saw its March contract fall by 50 cents to end at $278 an ounce. It was up 30 cents for the week.
"The absence of chart resistance points and persistent investor/fund demand leaves platinum with plenty of scope for gains in the coming sessions," said James Moore, an analyst at TheBullionDesk.com, in a daily commentary.
Meanwhile, inventories of copper were up 878 short tons at 10,058 short tons as of late Thursday, according to Nymex. Gold inventories were up 100,701 troy ounces at 7.32 million troy ounces, while silver supplies were at 124.1 million troy ounces, up 785,831 troy ounces.
Amex Gold Bugs Index up almost 7% on week
Shares of metals-mining companies closed mainly higher, helping the Amex Gold Bugs Index log an almost 7% climb for the week to a close at a fresh record.
The Amex Gold Bugs Index (HUI:
amex gold bugs index equal-$ weight
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