Gold barely moves after deadly Mumbai attacks

Gold barely moves after deadly Mumbai attacks
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First Published: Thu, Nov 27 2008. 10 23 AM IST
Updated: Thu, Nov 27 2008. 10 23 AM IST
Singapore: Gold was steady on Thursday after the euro bounced against the US dollar, but a series of attacks in India’s financial capital Mumbai which killed at least 101 people has yet to ignite safe-haven buying.
Indian troops began moving into two five-star hotels on Thursday where Western hostages were being held after the attacks which came amid state elections, including in Kashmir.
Gold was trading at $812.10 an ounce, up $0.35 an ounce from New York’s notional close on Wednesday. It rallied to a six-week high of $830.10 on Tuesday but has since struggled to sustain the uptrend due to volatile oil and currency markets.
“Until we know more about who’s involved, what their aims and ambitions are, it may well be considered to be an isolated incident,” said Darren Heathcote of Investec of Investec Australia in Sydney, referring to the attacks in India.
“Therefore, it’s less likely to affect the rest of the world, and therfore, the gold price,” said Heathcote, adding that gold was likely to stay in the current range of $770 to $825.
Gold, which was often bought by investors in times of uncertainty, was 21% below a record high of $1,030.80 struck in March but it has staged a dramatic rebound since tumbling to a 13-month low of $680.80 in October.
India, the world’s largest gold consumer, has suffered a wave of bomb attacks in recent years. Most have been blamed on Islamist militants, although police have also arrested suspected Hindu extremists thought to be behind some of the attacks.
The world’s largest gold-backed exchange-traded fund, the SPDR Gold Trust, said that it held758.12 tonnes of gold in bank as of 26 November, up 3.06 tonnes from 21 November.
“I am not sure about the situation in India and how it may affect gold. But from the gold charts, the ranges are narrowing again, so I guess we may see a much clearer direction maybe today or tomorrow,” said a dealer in Singapore.
The euro firmed to $1.2900 after falling as low as $1.2819 the previous session, partly on pessimistic views about the impact of a European 200 billion euro stimulus plan on the financial crisis.
Trading is expected to stay subdued throughout the day with US markets closed for the Thanksgiving holiday.
Platinum was trading at $857.00 an ounce, up $3.50 from New York’s notional close.
New York gold futures added $3.0 an ounce to $811.5.
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First Published: Thu, Nov 27 2008. 10 23 AM IST