Gold rallied more than 1% today alongside other assets and among a falling dollar. This is the fifth session in a row where gold has ended higher. The rally of the metal is mostly attributed to the current debt crisis within the euro zone.
Oct. 27, 2011, 2:00 p.m. EDT
By Claudia Assis
Market Watch
SAN FRANCISCO (MarketWatch) — Gold futures left behind a ho-hum start of trading to rally more than 1% Thursday, rising alongside other assets as investors cheered the latest euro-zone plan to contain the region’s sovereign-debt crisis and the dollar was weaker.
Gold for December delivery GC1Z +1.14% advanced $23.50, or 1.4%, to $1,746.70 an ounce on the Comex division of the New York Mercantile Exchange.
The contract spent most of the Asian and European trading hours in the red, recovering a bit as New York floor trading approached. Once other equities skyrocketed and the dollar took a beating, though, the yellow metal traded on firmer footing.
“You’ve got the return of risk appetite in full force today and you’ve got a U.S. dollar that really is getting beaten up badly,” said Matt Zeman, a trader with Kingsview Financial in Chicago.
European leaders meeting in Brussels late Wednesday agreed to a plan that included a voluntary 50% write-down on Greek government debt, more firepower for the region’s bailout fund and nearly $150 billion to recapitalize European banks. Read more about the plan.
The plan, and the optimism it elicited, also drove gains in other metals more closely linked to industrial uses. Other commodities such as oil also rose, and U.S. stocks surged on the heels of sharp gains for equities in Europe and Asia. See more Wall Street’s bullish reaction to European sovereign-debt plan.
Silver for December delivery SI1Z +5.64% rallied $1.96, or 5.9%, to $35.27 an ounce. Copper for the same month’s delivery HG1Z +6.48% settled 5.8% higher at $3.69 a pound.
Gold has ended higher for the past four sessions, rising 5.3% between Friday and Wednesday. The metal settled 1.4% higher on Wednesday.
The dollar index DXY -1.75% , which compares the U.S. unit to a basket of six currencies, traded at 74.930, as opposed to 76.207 in past dealings. The euro-zone deal lifted the euro and risk-oriented currencies, such as the Australian dollar.
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