Precious metals shine

Gold closes above $1200 an ounce

Bullion prices ended higher on Wednesday, 03 December 2014 at Comex to close above $1,200 as tepid U.S. data and higher oil prices revived buying interest. Gold prices ended the U.S. day session moderately higher Wednesday, on a short-covering rebound in the futures market and on some perceived bargain-basement buying in the cash market.

Gold for February delivery rose $9.30, or 0.8%, to settle at $1,208.70 an ounce.

March silver was off 4 cents at $16.41 an ounce.

A day earlier, the U.S. dollar's strength against major rivals pushed gold back below the $1,200 mark. The gold market also got a modest boost Wednesday morning when the U.S. ADP national employment report came out and did not quite meet market expectations. The figure showed a rise of 208,000 jobs in November, while the market place was expecting something in the range of up 230,000.

The U.S. dollar index hit a four-year high Wednesday and the Euro currency fell to a two-year low against the greenback. This was an underlying negative for the precious metals markets today that did limit the upside. The latest European Union purchasing managers index (PMI) came in weaker than expected Wednesday, which pressured the Euro. The data firm Markit reported the said the composite EU PMI for November was 51.1 versus 52.1 in October. A reading above 50.0 suggests the sector is growing.

The European Central Bank holds its monthly meeting on Thursday. Many believe the ECB will not yet move to further stimulate EU monetary policy, but most think its coming. Recent economic data coming out of the European Union suggests the ECB will make its move in the first quarter of 2015.

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