|
Gold escapes summer lows
|
 |
September 24, 1999: 3:18 p.m. ET
Prices rocket to nearly four-month high as investors flee stocks and weak dollar
|
NEW YORK (CNNfn) - Prices of gold futures surged to their highest levels in nearly four months Friday as investors sought a safe haven from a weakening dollar and the plummeting stock market.
Gold prices on New York's Comex climbed as high as $272.40 an ounce Friday before settling in at $269.50 an ounce, up $2.20 for the day, in mid-afternoon trading.
The strengthening demand for gold carried over into the stock prices of several mining companies. Battle Mountain (BMG) rose 1/4, or more than 12 percent, to 2-1/4. Meridian Gold (MDG) jumped 5/16, or more than 5 percent, to 6-3/16, Newmont Mining (NEM) climbed 1-5/16, or 6 percent, to 22-7/8 and Kinross Gold (KGC) rose 1/4, or 10 percent, to 2-5/8.
Kinross and Newmont also benefited from stock upgrades from Deutsche Bank Alex. Brown late Thursday. The investment bank rated both stocks "market outperform."
Analysts attributed the jump in gold prices to several factors, including a pent-up demand for the commodity, the weakening U.S. dollar and investors' desire to find a safer haven for their funds than the stock market, which has fallen on hard times of late.
However, opinions were mixed on whether the commodity would maintain its forward momentum. While some were predicting prices topping $300 an ounce before the end of the year, others were less optimistic about gold's long-term prognosis.
"I think gold is still a long-term bear investment and any of these technical corrections are temporary in nature," said Robert Stein, a senior economist at Stockbrokers.com. "There's no substantial reason to own gold anymore."
Still, gold's recent price surge represents a major turnaround from July, when gold prices hit a 20-year low after the Bank of England slashed its reserves to 300 tons from 715 tons.
|
|
|
|
|
|
CNNfn commodities
|
Note: Pages will open in a new browser window
External sites are not endorsed by CNNmoney
|
|
|
|
 |
|
