Gold, silver shoot higher on economic worries

AP News
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Posted: Aug 10, 2011 4:44 PM
Gold, silver shoot higher on economic worries

Gold and silver prices closed higher Wednesday as investors parked their money in hard assets they consider safer than stocks or currencies.

Gold for December delivery shot to a record $1,801 an ounce Wednesday before backing off those highs to finish at $1,784.30 an ounce. September silver also surged, gaining $1.444 to end at $39.327 an ounce.

Other commodities also rose, with everything from wheat to oil gaining value. Many of those contracts often fall when the stock market sinks, as it did Wednesday. Contracts for tangible materials like copper and corn can be more attractive investments when the value of stocks and currency remains uncertain.

"Cash is king, and next to it is hard assets," said George Gero, vice president at RBC Global Futures. "People (are) concerned about declining currency values and they feel that hard assets will always have a store of value."

Some industrial metals fell on worries that demand at the world's factories would slow. September palladium fell $7.75 to $726.80. Copper for September delivery fell 8.15 cents to $3.8885 per pound.

Aside from cooper and Palladium, commodity prices rose broadly. October platinum gained $15.30 to end at $1,771.70.

Wheat for September delivery rose 13.25 cents to finish at $6.85 per bushel. December corn was unchanged at $6.885 per bushel and November soybeans added 1.75 cents at $13.015 per bushel.

In energy trading Oil rose more than 4 percent Wednesday after the government said crude supplies shrank more than expected last week and a new report forecast strong global demand.

Crude was higher even though stocks fell. The major indexes on Wall Street were off more than 4 percent. Recently oil and stocks have tended to move in the same direction as energy traders gauged sentiment about the economy _ and energy demand _ from the rise and fall of stocks.

Benchmark crude for September delivery gained $3.59, or 4.5 percent to finish at $82.89 per barrel on the New York Mercantile Exchange.

Heating oil gained 10.05 cents at $2.8653 per gallon. Gasoline futures rose 11.49 cents to $2.7825 per gallon and natural gas added 0.9 cents to end at $4.003 per 1,000 cubic feet.