Gold and Silver surged Thursday on a variety of factors including higher wholesale prices and a jump in first-time applications for unemployment benefits.
By SANDY SHORE AP Business Writer
April 14, 2011 (AP)
Gold and silver prices surged Thursday after the government reported higher wholesale prices and a jump in first-time applications for unemployment benefits.
The Labor Department said more people applied for unemployment benefits last week, the first increase in three weeks. Broader trends point to a slowly improving jobs market.
The agency also reported that a 5.7 percent increase in gas costs pushed up wholesale prices in March. Excluding food and energy costs, inflation at the wholesale level was relatively low.
The news added to unease among investors about Europe's financial problems, Japan's crisis and uprisings in the Middle East and North Africa. That led to higher prices for precious metals, which are seen as more likely to remain stable during times of uncertainty.
CPM Group analyst Carlos Sanchez said some of the recent U.S. data reflects a slower improvement in the economy than had been expected early this year. That benefited gold prices.
Sanchez expects gold prices to reach $1,500 an ounce in the next few months. Metals research firm GFMS Ltd. predicted Wednesday that gold prices would top $1,600 an ounce before the end of the year.
Gold for June delivery rose $16.80 to settle at $1,472.40 an ounce. Silver rose $1.427, or 3.6 percent, to $41.664 an ounce.
In other metals trading, May copper fell 1.05 cents to settle at $4.284 a pound, July platinum added $18.40 to $1,795.60 an ounce and June palladium gained $8.95 to $774.25 an ounce.
Wheat prices fell after a weekend forecast from Weather Underground called for rain from the northern plains into the upper Midwest. The region has been plagued by dry weather for much of the winter wheat growing season.
Some producers are buying wheat over corn to feed livestock because corn prices have risen so rapidly because of tight supplies, Northstar Commodity analyst Jason Ward said.
Ward noted that corn prices were higher than wheat Wednesday and Thursday for the first time since 1996, when corn was also short supply.
In May contracts, wheat fell 12.25 cents to settle at $7.405 a bushel, corn lost 1.25 cents to $7.5425 a bushel and soybeans dropped 2.5 cents to $13.31 a bushel.
Energy contracts were mixed. Benchmark oil for May delivery rose $1 to settle at $108.11 on the New York Mercantile Exchange.
In other Nymex contracts for May, heating oil fell 1.38 cents to settle at $3.189 per gallon, gasoline slipped 0.77 cent to $3.2347 per gallon and natural gas rose 7.1 cents to $4.212 per 1,000 cubic feet.
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