Capital Gold Group Report: Gold is Safe Investment In Choppy Markets

23 Mar, 2008, 1125 hrs IST,Aman Dhall & Dheeraj Tiwari, TNN

With the stock markets on a downhill trek, a wave of panic has gripped the retail investors. In these uncertain times, you may have also found yourself struggling, and sometimes worried, on how to get the right portfolio mix and avoid the bear’s claws.

The same stands true for 45-year old Anand Sharma, who ran out of his wits after his year-long investments eroded in a matter of few seconds. If analysts are to be believed, in such turbulent phases, you can always look up to gold as an investment option not only as an insurance against the choppy markets but for better returns as well.

The Golden Scenario

With an expected slower US growth momentum, Fed rate easing, a weakening dollar, rising oil prices and heightened geopolitical concerns, gold prices appear to be firmly supported in the months ahead. Strong investor demand coupled with strong jewellery demand from Asia and the Middle East is also likely to push the prices. “In the present context, gold is expected to provide better capital appreciation, provided it is bought at a right price. It is also a good hedge against inflation,” says Mukesh Agarwal, director of Wealthcare Securities.

Strong fundamentals put aside, gold has also given a return of 18% in the first two months of 2008. “Today, it is the most recession-proof asset and is actually playing the role of insurance in the investor’s portfolio,” says Vandana Bharti, senior research analyst (commodity) at SMC.

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Capital Gold Group Report: Gold Safest Investment Option

Gold seen as safest investment option

Story by: Gemma Westacott
Magazine: FT Adviser
Published Thursday , May 29, 2008

Gold is seen as a safe bet, with 28 per cent of people claiming to feel most confident investing in gold during the current economic uncertainty.

According to research published by specialist insurance broker Aon Private Clients today (29 May), gold was seen as the safest bet, compared to 20 per cent of people feeling confident in property investment.

However, of the 2,031 adults surveyed, a third (34 per cent) said they were not confident of investing in anything at all. Women are much more cautious, with 38 per cent not willing to take the risk compared to just 24 per cent of men.

The results are dramatically different to those on Aon’s 2006 research, which showed that 58 per cent of people favored property investment to supplement a pension, followed by 50 per cent preferring shares.

Director at Aon Artscope & Specie Daniel Smith said: “Gold has historically been a safe haven for investors in times of trouble. Even the credit crunch and the biggest fall in gold price for a quarter of a century in March have failed to dent confidence.

“As with any market, prices will go up and down, but the price of gold has consistently increased over the longer period, so is still considered by most to be a sound investment.

“The survey results reflect the growing global appetite for gold and other precious metals. With its global appeal and emerging consumers, such as in China, the good news is that demand continues to outstrip supply, suggesting that the price will remain buoyant for the long term.”

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Capital Gold Group Report: Gold Coins Preserve Wealth

Philip Scott, This is Money

24 May 2008

Investors running scared from global stock market turmoil have flocked to gold funds, but is it worth putting your cash into the metal itself – sold as coins and bullion? tom of Form

With investors fearing global stock market volatility, gold has enjoyed a bumper year after finally hitting the $1,000 mark on March 17.

Although it has pulled back in recent weeks, the price of gold remains high and its climb has been steady. It averaged $924 per ounce in the first three months of the year – an 18% rise over the last three months of 2007.

And investors are piling in, snapping up gold directly or buying funds that back the precious metal. Figures from the World Gold Council show investment surged 163% to 284 tonnes in the first quarter of 2008.

But in addition the gold coin market has had a very strong ride. John Mulligan, investment research manager at the World Gold Council, says: ‘The retail coin market has had a very successful year.

‘It would appear that the failing of Northern Rock, the credit crunch and all the general uncertainty that followed, has pushed consumers towards gold.’

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Capital Gold Group Report: Steady $1,000 Gold Price ‘A Distinct Possibility’

A spokesperson from one of the world’s biggest mining corporations has predicted that gold prices could reach $1,000 an ounce again due to a lack of new discoveries of the precious metal.

Alexander Davidson, head of exploration and corporate development at Barrick Gold, told Reuters that he is bullish on future long-term gold prices, with a steady $1,000 an ounce price a distinct possibility.

He said that the costs involved in the gold mining process are causing the global output to fall, although demand is as robust as ever.

“The industry cost structure is such that to find a mine, build a mine, or acquire a mine and then operate a mine the break-even cost for the industry now is probably in the $700 to $800 range,” he said.

Earlier this week, David Galland, writing for Resource Investor, said that he believes the era for gold discoveries has now peaked, with new mines only yielding a fraction of previous outputs.

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Capital Gold Group Report: Gold Jumps Above $925 on Bargain Hunting and Dollar Weakness

FXStreet.com
Fri, May 23 2008, 12:56 GM

LONDON (Thomson Financial) – Gold jumped above $925 after closing well below a one month peak on Thursday on bargain hunting, expectations for dollar weakness and as inflation concerns remained ahead of a long weekend.

The U.S. and UK markets will be closed on Monday, leading to some increased purchases.

Rocketing oil prices, which remain close to record highs, coupled with expectations for dollar weakness are supporting the precious metal. Meanwhile, the threat of more economic weakness remains, which boosts gold’s safe haven appeal.

“The macroeconomic environment remains broadly supportive of gold prices,” said HSBC analyst James Steele. “Factors supporting gold include the credit crunch, heightened financial market instability, and an increase in inflationary pressures associated with rising oil and food prices. These factors, including prolonged dollar weakness, in our view, encourage investor demand for safe-haven assets, notably gold.”

While the dollar has picked up against the euro slightly over the past day, analysts say the greenback’s rise will be limited, particularly ahead of the release of U.S. home sales data later on Friday.

“A major test arrives today … in the form of the U.S. existing home sales data for April,” said Steve Pearson, analyst at HBOS.

“The downtrends in both mortgage applications for home purchase and pending home sales point to further weakness. This could well provide something of a reality check to markets, with the U.S. dollar and equities turning tail simultaneously,” he said.

Such weakness could spark another round of gold buying.

At 1:31 p.m., spot gold was trading at $925.80 per ounce against $918.60 in late New York trade on Thursday. Gold hit $935.18 Thursday, its highest value in a month.

In other precious metals, platinum was higher at $2,180 per ounce from $2,171.

Meanwhile, sister metal palladium edged down to $447 per ounce from $451.

Silver rose to $18.21 per ounce from $17.94.

Copyright Thomson Financial News Limited 2008. All rights reserved.

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Capital Gold Group Report: Profit Taking on Gains in Gold Creates Buying Opportunity

By Polya Lesova, MarketWatch

Last update: 2:16 p.m. EDT May 22, 2008

NEW YORK (MarketWatch) — Gold futures closed sharply lower Thursday, coming under pressure as the dollar rose against other major currencies and oil prices declined.

Gold for June delivery dropped $10.30 to end at $918.30 an ounce on the New York Mercantile Exchange.

“The strong dollar, weak crude and a possible over-reaction to the Fed minutes yesterday seem to be driving gold lower,” said Zachary Oxman, a senior trader at Wisdom Financial.

“Until we cross and close above the $940 level, we’ll remain range-bound between $900 and $940,” Oxman said.

Federal Reserve officials have lost their appetite for more interest-rate cuts, even if the economy sinks into recession, according to the minutes of their last policy meeting released Wednesday.

“A day of profit-taking in crude oil put a significant damper on precious as well as base metals, highlighting just how much of their recent revival was in sympathy with the runaway energy complex,” said Jon Nadler, senior analyst at Kitco Bullion Dealers.

“A rising level of bets that the Fed will not only not cut rates at its next meeting in June, but that it will begin thinking about raising them as the year wears on supported the dollar,” Nadler said.

Crude-oil futures declined, retreating from an overnight record high above $135 a barrel as traders took in profits from a four-session winning streak that lifted prices for the commodity by more than 7%.

On the currency markets Thursday, the dollar got a lift against major rivals after better-than-expected weekly jobs data. The dollar index, which tracks the performance of the greenback against a basket of other major currencies, rose 0.4% to 72.18.

Dollar strength typically pressures dollar-denominated commodities, such as gold and crude oil, because it makes them more expensive for holders of other major currencies.

The Labor Department reported that first-time claims for state unemployment benefits fell back in the latest week, dropping by 9,000 to 365,000 on a seasonally adjusted basis.

Separately, the Office of Federal Housing Enterprise Oversight reported that U.S. home prices fell a seasonally adjusted 1.7% in the first three months of 2008 — the largest quarterly price decline on record. Prices fell in 43 states, according to the agency.

On Wednesday, gold futures gained $8.40 an ounce, taking the metal’s total price gain to more than 7% in five sessions.

“Some profit-taking has been witnessed [in gold], which is no great surprise, considering the scale and pace of gains made by the precious metal,” said James Moore, an analyst at TheBullionDesk.com.

“However, given the continued upward thrust of oil and the bearish dollar sentiment, we expect gold to remain strong and to target the $954 highs of March and February in the coming sessions,” Moore said in a research note.

Also on the Nymex, July silver futures fell 3 cents to $18.02 an ounce. July platinum fell $37.30 to end at $2,183.80 an ounce and June palladium futures dropped $6.25 to end at $456.95 an ounce. July copper fell 3 cents to $3.71 a pound.Capital Gold Group, gold group, gold, gold prices, gold news, gold coins, gold bullion, gold IRA, IRA gold

Capital Gold Group Report: Oil May Lead Gold to $1,500

By Myra P. Saefong & Polya Lesova, MarketWatch

Last update: 10:48 a.m. EDT May 21, 2008

SAN FRANCISCO (MarketWatch) — Gold futures edged higher to trade near $923 an ounce on Wednesday, with weakness in the U.S. dollar and soaring oil prices set to extend a four-session winning streak that’s already added 6% to the metal’s price.

“Oil is obviously leading gold and if the historical gold vs. oil ratio ever returns, we could see gold as high as $1,500,” said Peter Grandich, editor of the Grandich Letter.

“There’s an inevitable correction in oil but after a short while, we should see money plow back in as oil, food and water shortages are going to make these commodities in high demand for years to come,” Grandich said in emailed comments.

Gold for June delivery gained $2.60 at $922.80 an ounce on the New York Mercantile Exchange. It climbed as high as $923.30 earlier in the session.

As of Tuesday, the contract logged a gain of $53.70 since the May 14 close at $866.50.

“After yesterday’s rally, dips are likely to be viewed as buying opportunities as energy price gains increase inflationary pressure, while the interest rate differential between Europe and the U.S. keeps the dollar under pressure,” James Moore, an analyst at TheBullionDesk.com, wrote in a research note.

On the currency markets, the U.S. dollar fell against most of its major counterparts, with the dollar index dropping 0.5% to 72.10.

Signs of resilient business sentiment in Germany, Europe’s largest economy, sent the euro higher across the board, underlining speculation that the European Central Bank will further delay any cuts in interest rates. The euro rose 0.7% against the dollar.

Dollar weakness typically benefits dollar-denominated commodities, such as gold and crude oil, because it makes them cheaper for holders of other major currencies.

Gold’s appeal as an inflation hedge was also boosted by the surge in oil prices, which broke through another key level on Wednesday, this time topping $130 a barrel on the familiar fears that supplies can’t keep up with growing demand from emerging markets.

Also on the Nymex, July silver futures gained 4 cents at $17.765 an ounce and July platinum rose $22.20 at $2,170. an ounce. June palladium shed $2.85 at $447.40 an ounce, while July copper fell 3 cents to $3.75 a pound.

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Capital Gold Group Report: Gold Climbs to $915 on Declining US Dollar and Rising Oil Prices

By Myra P. Saefong & Polya Lesova, MarketWatch

Last update: 10:46 a.m. EDT May 20, 2008

SAN FRANCISCO (MarketWatch) — Gold futures climbed to $915 an ounce Tuesday to trade at their strongest levels in a month as a decline in the U.S. dollar and rising oil prices enhanced the metal’s appeal as an investment hedge.

Gold for June delivery climbed as high as $915 an ounce on the New York Mercantile Exchange, a level not seen since April 22. It was last up $8.40, or 0.9%, at $914.20.

June gold climbed as high as $915.70 an ounce in electronic trading.

The contract was ready to mark a fourth-straight session of gains. It’s already climbed by more than $39, or 4.5%, over the last three trading days.

“The continued gains being made in the energy sector, and the anti-inflationary hedging this is creating,” is likely to see gold extend higher, said James Moore, an analyst at TheBullionDesk.com, in a research note.

Crude-oil futures rallied Tuesday, touching a high of $129.45 a barrel in New York, as weakness in the U.S. dollar underpinned oil prices.

In the currency markets, the U.S. dollar fell against its major rivals on higher inflation in Germany and tamer U.S. inflation. The dollar index, which tracks the performance of the greenback against other currencies, fell to 72.502 from 73.059 in late North American trading Monday.

Weakness in the U.S. dollar typically benefits dollar-denominated commodities, such as gold and crude oil, because it makes them cheaper for holders of other currencies.

Year to date, gold is up nearly 9% — unlike most equity markets, said Mark O’Byrne, a director of Gold and Silver Investments Ltd., in a note to clients. And “in the last 12 months, gold is up 37%, and thus corrections are healthy and to be expected.”

Also on the Nymex, July silver gained 25 cents at $17.28 an ounce. It’s trading at its strongest level since late April. July copper futures fell was down 1 cent to $3.77 a pound.

July platinum fell $3.60 to $2,154.60 an ounce and June palladium shed $5.85 to $445.50 an ounce.

Global platinum supplies weren’t enough to meet demand in 2007, platinum group metals refiner Johnson Matthey said Monday in its annual industry review report. But supplies of palladium were more than enough to meet demand. . . .
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Capital Gold Group Report: Gold Prices Firm as Rising Oil Price Fuels Inflation Fears

Thomson Financial News
Metals – Gold prices firm as rising oil price fuels inflation fears
05.19.08, 10:40 AM ET

LONDON (Thomson Financial) – Gold was higher in the early afternoon as oil rose back towards last week’s record high, fueling buying of the precious metal as an inflation hedge and as the dollar languished after earlier touching a two-week low against the euro.

Rising fears over inflation have helped buoy gold prices in recent days, analysts said.

‘Inflation hedging and safe haven buying is reemerging on both the surging oil price, inflationary pressures and with much of the economic data being very negative last week, especially the appalling consumer sentiment numbers which showed consumer confidence falling to their lowest levels since 1980, 28 years ago,’ said analysts at Ireland’s Gold Investments in a note.

Concerns about the ongoing health of the dollar, despite what many see as a short-lived bounce in recent weeks, are also helping sentiment towards gold, they added.

The currency hit a two-week low against the euro in the morning, although it has since recovered some ground. Weakness in the greenback supports buying of gold, which is typically seen as an alternative investment to the U.S. currency.

At 2:14 p.m., spot gold was trading at $908.53 per ounce against $899.70 in late New York trade on Friday.

Among other precious metals, platinum prices reached an intraday high of $2,171 per ounce after Johnson Matthey released a report predicting prices will post a ‘strong performance’ this year, with 2007’s market deficit seen continuing in 2008.

The white metal could reach a high of $2,500 an ounce this year, with a floor in prices seen at $1,775, the metals consultancy said.

The platinum market swung to a deficit of 480,000 ounces in 2007 from a surplus of 355,000 ounces the year before, Johnson Matthey said, as South African supply was cut by labor disruptions, accidents and equipment failures.

Overall supply fell by 4.1 pct last year to 6.55 million ounces, with South African supply down 4.9 pct, or 260,000 ounces, to 5.04 million ounces.

Investment demand hit 170,000 ounces last year, against disinvestment of 40,000 ounces in 2006. Investment buying was buoyed by the launch of two exchange-traded funds in London and Switzerland, which accounted for new demand of 195,000 ounces in 2007.

While prices initially edged higher on the news, with a positive report from Johnson Matthey already largely priced into the market earlier into the day, platinum prices later slipped back from highs to trade at $2,155 against $2,121 in late trade on Friday.

Meanwhile platinum’s sister metal, palladium, eased to $442 per ounce against $446, while silver rose to trade at $17.04 per ounce from $16.92.

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Gold Group News Report: Gold Back Over $900 on Oil’s Record High of $127

John Jameson on May 16, 2008 9:28 AM | Permalink

By Polya Lesova, MarketWatch

Last update: 9:16 a.m. EDT May 16, 2008

Gold futures rise as oil surges to new record

NEW YORK (MarketWatch) — Gold futures surged early Friday, as crude oil’s rally to a fresh record high above $127 a barrel boosted the precious metal’s appeal as an inflation hedge.

 

 

Gold for June delivery rose $14.60 to stand at $894.60 an ounce on the New York Mercantile Exchange.

“The dollar is flat, but oil is again higher and this is contributing to gold’s rally this morning,” said Mark O’Byrne, director at Gold & Silver Investments Ltd., in a research note.

In energy trading, crude-oil futures rallied to a fresh record high of $127.43 a barrel, as bullish momentum returned to the market and traders rushed to buy energy futures.

On Thursday, the benchmark gold contract had surged $13.50 to close at $880 an ounce.

“Near-term downside risk remains in the market as reports from several trading desks indicate that retail investor demand is still weak and large specs are seen selling into strength,” said Jon Nadler, senior analyst at Kitco Bullion Dealers, in a note to clients.

Still, it’s been “a commendable turn in gold over the past two days,” Nadler wrote.

On the currency markets, the dollar pared some of its losses after better-than-expected U.S. housing data for April. 

The dollar index, which tracks the performance of the greenback against other major currencies, fell 0.05% to 73.31.

The metals complex traded higher across the board.

July silver futures rose 26 cents at $16.95 an ounce, July platinum futures moved up $71 at $2,157.90 an ounce, June palladium rose $5.65 at $446.25 an ounce and July copper futures rallied 9 cents at $3.83 a pound.

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