Bullion Prices and Business Weekly Update – August 28, 2010

U.S. gold prices edged 20 cents higher on Friday, capping a string of four consecutive weekly gains. Gold continued to ride on the back of safe-haven buying driven by recovery concerns.

But it was silver that shined the brightest, soaring 5.8 percent for the week and hitting a two-month high above $19 an ounce. Palladium was just as lustrous in its weekly gain, surging 5.6 percent, while platinum scored a more modest increase of 1.5 percent.

In black gold, oil pulled away from two weeks of losses to snap above $75 a barrel. And while U.S. stocks rallied on Friday, the major indexes fell for the week with the Dow and S&P knocked down for three.

In U.S. precious metals futures prices, gold for December delivery finished at $1,237.90 an ounce, advancing $9.10, or 0.7 percent, this week.

"There is going to be in all likelihood a surge in investment demand toward the end of this year, driving prices toward the $1,300 level and possibly beyond," GFMS Ltd. CEO Paul Walker said in an interview that was cited on Bloomberg. "Prices are going to ratchet up," adding "There is a wide enough group of people who are going to continue buying gold for a variety of reasons and that’s going to be the key driver of price action."

Silver for September deliver closed to $19.039 an ounce, adding 5.7 cents on Friday and surging $1.048 during the week.

"Much of silver’s recent rally is due to expanding investor interest, as registered by rising CME volumes and options-related buying – but there’s also been a notable increase in ETF buying," Edel Tully, UBS precious metals strategist, said in a daily report on Thursday. "We are positive toward silver this year, and see potential for it to gain as the ‘poor man’s gold’, a cheap alternative to the primary safe-haven asset," she added.

Platinum for October delivery closed to $1,537.00 an ounce, falling $2.90 on Friday. However, the precious metal registered a weekly increase of $23.10.

Palladium for September delivery rose 55 cents to end the week at $503.05 an ounce. It jumped $26.85 since last Friday.

In London bullion prices, the gold Fix was $1,235.00 an ounce, rising $11.50, or 0.9 percent, for the week.

"The initial hesitation and divergent behavior in the US currency, oil, base metals and gold revealed some uncertainties in how to interpret the data among players," noted Jon Nadler, senior analyst at Kitco Metals, Inc. "Later on, the emerging consensus among investors appeared to be that the US GDP data was a case of ‘less worser’ in the making."

In other weekly London precious metal prices, silver surged 89 cents, or 4.9 percent, to $19.030 an ounce. Platinum was $1,530.00 an ounce, rising $18.00, or 1.2 percent. Palladium was $503.00 an ounce, soaring $25.00, or 5.2 percent.

To follow are silver, gold, platinum and palladium performance charts, oil news, week-ending stocks, and precious metal article summaries.

London Fix Charts: Silver, Gold, Platinum and Palladium

(August 20 – 27)

The London Fix is one of the most used bullion quotes around the world. The London AM fix for gold and platinum begins at 10:30am GMT (5:30am in New York), and the PM fix begins at 3pm GMT (10am in New York). The London Fix for silver begins each business day at 12pm GMT (7am in New York).

August London Fix Precious Metals Prices

Business News: Oil, Gasoline, and Stocks Prices

Crude oil prices climbed for a "third straight day on Friday, rallying with equities as investors shrugged off revised lower second quarter growth data and cautionary remarks by the Federal Reserve chief," wrote Robert Gibbons of Reuters.

"The market was oversold, and when we failed to take out the May lows the buyers came back in," Richard Ilczyszyn, a Chicago-based senior market strategist at Lind-Waldock, a division of MF Global Inc, said and was quoted on Bloomberg. "We’re now going to test $77.55, the 50-day average, unless the stock market collapses."

U.S. crude oil for October delivery jumped $1.81, or 2.47 percent, to $75.17 a barrel. Front month oil prices this week rallied $1.71, or 2.33 percent, after falling $1.93, or 2.6 percent, last week.

Prices at the pump remained unchanged between Friday and Saturday. The national average for regular unleaded gasoline is $2.682 a gallon, according to the daily AAA fuel report. The price is 3.6 cents lower than last week, 6.2 cents down from the price of a month back, but 6.9 cents higher than a year ago.

U.S. stocks and "commodities surged while Treasuries retreated after Federal Reserve Chairman Ben S. Bernanke pledged to safeguard the recovery and economic growth slowed less than estimated in the second quarter," noted Nikolaj Gammeltoft and Stephen Kirkland of Bloomberg.

Friday closing figures for the three major U.S. indexes follow:

• The Dow surged 164.84 points, or 1.65 percent, to 10,150.65.

• The S&P soared 17.37 points, or 1.66 percent, to finish at 1,064.59.

• The NASDAQ jumped 34.94 points, or 1.65 percent, to 2,153.63.

For the week, the Dow declined 0.62 percent, the S&P 500 lost 0.66 percent, and the Nasdaq fell 1.20 percent.

And in other world markets on Friday:

• The German DAX climbed 38.59 points to 5,951.17.

• The Paris CAC 40 rose 32.41 points to end at 3,507.44.

• The London FTSE 100 gained 45.72 points to 5,201.56.

For the week, the DAX fell 0.90 percent, the CAC 40 lost 0.53 percent and the FTSE 100 rose modestly by 0.12 percent.

Economists forecast the U.S. economy lost 100,000 jobs in August, the FOMC releases minutes from its most recent meeting and BHP Billiton kicks off its road show in support of its bid for Potash. These topics and more are covered in the following Reuters "The week ahead" video:

Bullion and Economic Articles

In related bullion, business and United States Mint news, interesting or quick-read articles from the week include:

• National Park Silver Bullion Coins
  United States Mint expects that it will begin producing 2010 National Park and Site Silver Bullion Coins later this fall. The U.S. Mint had never announced launch dates for each coin, but earlier in the year expectations were more in line with a late summer release for the first issue, with the others staggered later …

• US Mint Sales: Bullion Silver Eagles Rally
  Collectors have been busier, purchasing greater amounts of United States Mint numismatic products which translated into nearly across-the-board weekly coin sales improvements. U.S. Mint bullion coins were also scooped up quicker after several weeks of lazy numbers.

  Bullion American Silver Eagle coins are showing some life after several weeks of sluggish sales, as compared to how they’ve been on fire most 2010 weeks. Their numbers grew 700,000 to just over 1.8 million for August. With silver topping $19 an ounce …