Gold and Silver Rebound After Ben Bernanke Reassures Investors

GOLD

On Thursday, gold (NYSEARCA:GLD) futures for August delivery, the most active contract, jumped $32.50 to close at $1,279.90 per ounce, while silver (NYSEARCA:SLV) futures for September gained 80 cents to finish at $19.96.

Precious metals and stocks both received a strong amount of support as Federal Reserve Chairman Ben Bernanke reiterated late Wednesday that the central bank will keep quantitative easing going for quite some time.

At a conference sponsored by the National Bureau of Economic Research, Bernanke said, “I think you can only conclude that a highly accommodative monetary policy for the foreseeable future is what’s needed in the U.S. economy.” He also reminded the market that there will “not be an automatic increase in interest rate when unemployment hits 6.5 percent.”

In the most recent jobs report, the unemployment rate stayed the same at 7.6 percent in June, though it was slightly higher than expected. The U-6 unemployment rate, which includes everyone in the headline rate plus people who are either employed part-time but prefer a full-time position or want work but have stopped looking, jumped from 13.8 percent to 14.3 percent — its highest level in four months.

The U.S. Bureau of Labor also reported Thursday that jobless claims climbed higher last week, reaching a two-month high. First-time claims increased 16,000 to 360,000, well above estimates calling for 340,000 claims.

In afternoon trading, shares of the SPDR Gold Trust (NYSEARCA:GLD) increased 2.7 percent while the iShares Silver Trust (NYSEARCA:SLV) gained 4.8 percent. Gold miners (NYSEARCA:GDX) Barrick Gold (NYSE:ABX) and Newmont Mining (NYSE:NEM) jumped 8.1 percent and 4.9 percent, respectively. Shares of Endeavour Silver (NYSE:EXK) surged 6.5 percent.

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Disclosure: Long EXK, AG, HL, PHYS