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MARKETWATCHTOPSTORIES
Gold, metals rise with Asian buying in play
Gold futures get a boost from talk of Asian demand
By Nick Godt, MarketWatch
Last Update: 2/11/2010 12:04:00 PM
NEW YORK (MarketWatch) -- Futures for gold and most metals rose Thursday, helped
by talk of renewed demand from Asia, where Vietnam implemented another
devaluation of its currency.
Gold for April delivery was last up $12.70, or 1.2%, at $1,089 an ounce in
electronic trade.
Industrial metals, such as copper, were also higher.
"We're seeing some short-covering and technicals are improving," said Suraj
Raythatha, metals analyst at Royal Bank of Canada. "Volumes continue to be strong
ahead of the Chinese holiday."
China's Lunar New Year, on Feb.14, traditionally sees a drop in economic activity
and demand for commodities. But it often leads to volatility ahead of and after
the celebrations.
Analysts at GoldCore also noted Vietnam's implementation of its second currency
devaluation since November, which boosted demand for gold there to hedge against
the weaker currency.
"The dong's continuing devaluation explains the significant demand seen for gold
in Vietnam in recent weeks as seen in the continuing high premiums being paid for
gold -- local Vietnam gold stood at a $17.08-an-ounce premium to world gold of
$1,077 an ounce yesterday," they wrote in a note.
On Wednesday, the contract ended 90 cents lower at $1,076.30 an ounce on the New
York Mercantile Exchange.
It received an early lift on hopes for a European Union plan to help Greece deal
with its fiscal situation.
European Council President Herman Van Rompuy read a statement saying that no
direct aid will be delivered to Greece but that European governments stand ready
to assist the country if needed.
The European Commission and the European Central Bank will monitor Greece's
budget-cutting efforts -- a first assessment will come in March -- and the
International Monetary Fund will provide technical assistance.
Crude oil and U.S. stocks also benefited from the government's report that weekly
first-time unemployment claims fell the most since July. Read more about jobless
claims
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