Gold and silver staged a strong rebound today, boosted by demand from bargain hunters, who believe gold has bottomed out after shedding nearly US$400 in just three weeks. Gold hit US$1,540 per ounce middle through Monday's session compared to its all time high of US$1,921, reached earlier this month.
The price of gold added more than US$30 per ounce by midday, while silver tacked on nearly US$2.
Even though gold is perceived as a safe haven asset, the sharp decline in the price of gold came amid a sell-off in stock markets on fears that the US and Europe were headed for a recession. Investors were opting for the US dollar for wealth protection, fearing that the gold rally was running out of steam.
Equities in the US and Europe have bounced back this week with the main stock market indexes surging today as the outlook for the European debt crisis improved amid reports that EU policymakers are set to step up their response to the debt crisis, which US President Barack Obama said scared the world.
Gold traded at US$1,661/oz this afternoon, up US$33 from yesterday’s close. Silver climbed US$1.90 to US$32.65/oz and platinum rose US$19 to US$1,576/oz.
Today’s top risers in the sector were:
Arian Silver (LON:AGQ), up 16 percent at 22.15 pence at midday
Condor Resources (LON:CNR), up 13.5 percent at 6.09 pence
Caledonia Mining (LON:CMCL), up 12.5 percent at 6.75 pence
Fresnillo (LON:FRES), up 10 percent at 1,675 pence
Medusa Mining (LON:MML), up 10 percent at 471.25 pence
The top fallers were:
Central Rand Gold (LON:CRND), down 53 percent at 0.233 pence at midday
Hambledon Mining (LON:HMB), down 11 percent at 3.67 pence
Orsu Metals (LON:OSU), down 10.5 percent at 8.52 pence
GMA Resources (LON:GMA), down 8.5 percent at 0.343 pence
Kryso Resources (LON:KYS), down 5 percent at 16.5 pence