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Gold, silver rally on Russian aggression

Published 03/03/2014, 05:17 AM
Gold, silver futures rally as U.S., Europe threaten to punish Putin
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Investing.com - Gold and silver futures rallied sharply on Monday, as the chance of military conflict in Ukraine mounted following Russia's seizing of control of the Crimean peninsula.

On the Comex division of the New York Mercantile Exchange, gold futures for April delivery rose to a session high of $1,350.30 a troy ounce, the most since October 30.

Gold prices last traded at $1,343.70 an ounce during European morning hours, up 1.55%, or $22.10. Gold futures settled down 0.77%, or $10.20, on Friday to end at $1,321.60 an ounce.

Prices were likely to find support at $1,319.30 a troy ounce, the low from February 28 and resistance at $1,359.40, the high from October 30.

Meanwhile, silver for May delivery rallied 1.1%, or $0.22 cents, to trade at $21.46 a troy ounce. The May contract ended Friday’s session down 0.52%, or $0.11 cents, to settle at $21.24 an ounce.

Silver futures were likely to find support at $21.02 a troy ounce, the low from February 27 and resistance at $22.06, the high from February 26.

Geopolitical tensions mounted over the weekend as Russian forces reportedly are now in complete control of the Crimean peninsula after Russia's parliament authorized President Vladimir Putin to use military force in Ukraine.

U.S. President Barack Obama and the leaders of the U.K. and Germany expressed "grave concern" on Sunday over Russia's intrusion into Ukraine, which they called a breach of international law and a threat to international peace and security.

U.S. Secretary of State John Kerry, who will visit Kiev on Tuesday, said the U.S. was considering imposing economic sanctions against Russia, in an effort to isolate the country and punish it for its actions.

Investors now looked ahead to U.S. economic data later in the day for further indications on the strength of the economy and the future course of monetary policy.

The U.S. is to release data on personal spending, while the Institute of Supply Management is to release data on manufacturing activity.

A recent series of disappointing U.S. economic indicators have sparked concerns that the recovery has lost momentum since the end of last year as inclement winter weather weighed on growth.

Elsewhere on the Comex, copper futures for May delivery declined 0.65% to trade at $3.167 a pound, the lowest since November 21.

Comex copper prices extended losses from last week as lingering concerns over the health of China’s economy and a weakening Chinese Yuan dampened sentiment.

Data released over the weekend showed that China’s official manufacturing PMI fell to an eight-month low of 50.2 in February from 50.5 in January.

The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.

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