Gold futures retreat from one-month high Silver prices turn lower after touching 22-year high By Myra P. Saefong, MarketWatch Last Update: 10:29 AM ET Mar 3, 2006
SAN FRANCISCO (MarketWatch) -- Gold futures retreated from a one-month high Friday but remained on track to end the week with a gain, as traders continued to give the precious metal its due as a refuge from the uncertainty surrounding other financial markets.
Silver prices moved modestly lower after touching a 22-year high on expectations that a silver exchanged-traded fund will soon be launched.
Gold for April delivery in early action climbed as high as $571 an ounce on the New York Mercantile Exchange, its highest level since Feb. 6, but the contract was last down $3.70 at $566.70. A week ago, it closed at $561.20. See April gold chart.
"Gold should find temporary resistance around $572 but a re-test of January's $575 high now appears imminent with resistance above now expected at $578/$582," said James Moore, an analyst at TheBullionDesk.com, in a note to clients.
Meanwhile, April silver was down 4.8 cents at $10.16 an ounce, turning lower following a rise to a new 22-year high of $10.31. The contract climbed by more than 4% on Thursday as traders bet that the silver ETF in registration from Barclays Global Investors may soon begin trading.
Silver's prices were trading more than 3% above last Friday's close of $9.825.
Although there was no official confirmation the ETF has gained regulatory approval, the Securities and Exchange Commission recently closed a 21-day public comment period on the fund.
"It seems that the precious metals community is anticipating the launch of the silver ETF," said Todd Stein and Steven McIntyre, editors of investment newsletter Texas Hedge Report, in a note issued Friday. See full story.
"The 130 million ounces of silver needed for the launch of securitized silver are not going to be easy to come by, nor will they leave much available for investors who have been just starting to chase after the white metal as soon as gold reached new highs," according to Jon Nadler, an investment products analyst at bullion dealers Kitco.com.
Elsewhere in the metals sector, May copper fell by 1.5 cents to stand at $2.266 a pound, above last Friday's close of $2.207. The June palladium contract rose $4 an ounce to $307 an ounce, up about $14 from the week-ago close, and April platinum rose $8.20 to $1,063 an ounce, more than $20 above last week's close.
On the supply side, inventories of copper fell 43 short tons to 30,378 short tons as of late Thursday, according to Nymex. Gold inventories were down by 98 troy ounces at 7.52 million troy ounces, while silver supplies were pegged at 129.0 million troy ounces, up 1.14 million troy ounces.
Mining indexes weaken
Key indexes that track the metals-mining sector headed lower to mirror gold's decline, but two benchmarks remain higher on the week after posting gains of about 3% on Thursday.
The Amex Gold Bugs Index (HUI :321.95, +0.19, +0.1% ) sank to 318.55, down 1%; it closed out last week at 313.29. The CBOE Gold Index (GOX :134.60, -0.75, -0.6% ) fell 1.7% to 133.09 points, but that's still up from last week's close of 132.48.
The Philadelphia Gold and Silver Index (XAU :138.20, -0.89, -0.6% ) shed 1.7% to stand at 136.77 points, down from last Friday's close of 138.93.
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