On Thursday, gold (NYSE:GLD) futures for December delivery jumped $24.20 to settle at $1,747.70 per ounce, while silver (NYSE:SLV) futures gained $1.80 to settle at $35.11. Gold and silver have now closed higher for five consecutive days.
Meeting at a summit in Brussels, European leaders continued negotiations well past midnight, with banks and other major investors in Greek bonds ultimately agreeing to take losses of up to 50%, a concession meant to prevent the Greek government from defaulting on bills it cannot pay, the repercussions from which would have been a significantly larger shock to the European financial system than the steep haircut.
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European government leaders also agreed that the European Financial Stability Facility would be allowed to help countries such as Italy and Spain, which find themselves deep in debt, to borrow at least a trillion dollars by providing them with a kind of insurance that would make their bonds more attractive to investors.
The Dow (NYSE:DIA) jumped more than 300 points as news broke from Europe and the US GDP number came in at 2.5%. However, the story of the day involves the US dollar (NYSE:UUP), gold, and silver. The euro jumped to a 7-week high against the dollar. The DXY index has now broken below 75. As a result, gold (AMEX:GDXJ) and silver (NYSE:SIL) miners surged. In afternoon trading, AngloGold (NYSE:AU) gained more than 3.2%, while Yamana Gold (NYSE:AUY) jumped 4.5%. AngloGold, Africa’s largest gold miner, has started paying 30% corporate tax to the Tanzanian government this year for its Geita mine. The company will pay a total of $48 million this year. Barrick Gold (NYSE:ABX) also increased more than 2% after reporting a 45% increase in earnings for the third quarter. With a euro meltdown averted for at least today, silver miners such as First Majestic (NYSE:AG), Fortuna (FSM), and Endeavour (AMEX:EXK) gained nearly 5%.
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