Gold (NYSE:GLD) futures for December delivery jumped more than $36 to settle at $1,661, while silver (NYSE:SLV) futures climbed 70 cents higher to finish just under $31. After a pullback in late September, investors appear to be bargain hunting and positioning themselves for more global uncertainty.
Investing Insights: Did the Gold and Silver Plunges Shakeout the Weak?
Gold and silver started the fourth quarter to the upside as the Greek drama begins a new episode. CNBC reports, “Greece will miss a deficit target set just months ago in a massive bailout package, according to government draft budget figures released on Sunday, showing that drastic steps taken to avert bankruptcy may not be enough.”
Although gold and silver spot prices rose, many equity plays gave up gains as the Dow (NYSE:DIA) sold off in the afternoon. AngloGold Ashanti (NYSE:AU) and Yamana Gold (NYSE:AUY) traded down nearly 2% as the Dow fell 200 points. Silver miners (NYSE:SIL) such as First Majestic (NYSE:AG) and Endeavour Silver (AMEX:EXK) also fell more than 2% during the trading day. Freeport-McMoRan (NYSE:FCX) climbed higher early in the day, but has since given up gains. The company, along with Goldcorp (NYSE:GG), received an upgrade from Deutsche Bank (NYSE:DB) to Buy.
Did You Hear That? Over the weekend, Qatar Holdings, which manages the wealth of the Middle East state’s royal family, confirmed it would invest nearly $1 billion in European Goldfields, a London-listed miner currently developing the largest gold mining project in Greece. The $1 billion investment is part of a longer-term strategy to spend up to $10 billion acquiring stakes in gold miners.