Gold Prices Edge Higher as Stocks Stumble

Strategic Insights -

Gold prices remained relatively steady on Friday, September 9, 2011, as traders sought safe-haven assets amidst stock market declines. The December delivery gold contract on the Comex division of the New York Mercantile Exchange rose $1.30, or 0.1%, to $1,858.80 per troy ounce. The Standard & Poor's 500 index fell 18.25 points, or 1.5%, to 1167.65 points. A stronger dollar, however, curbed gold's gains, as investors who use foreign currencies to buy gold face a higher price due to the dollar's increased value.

Key Takeaways:

  • Gold prices rose $1.30, or 0.1%, to $1,858.80 per troy ounce for the December delivery contract, driven by stock market declines.
  • The Standard & Poor's 500 index fell 18.25 points, or 1.5%, to 1167.65 points, prompting investors to seek safe-haven assets like gold.
  • A stronger dollar, with the ICE Dollar Index at 77.020, up from 76.265 late Thursday, put pressure on gold prices.
  • The inverse link between gold and stocks has been weakening in recent days, but gold prices continue to move in the opposite direction to stocks.
  • The 30-day correlation between gold futures and the S&P 500 was recently at negative-0.6, down from negative-0.9 in mid-August.

Statistics:

  • Gold price increase: $1.30 (0.1%) to $1,858.80 per troy ounce.
  • Standard & Poor's 500 index decline: 18.25 points (1.5%) to 1167.65 points.
  • ICE Dollar Index value: 77.020.

Sources:

  • Dow Jones Commodities News via Comtex. "Comex Dec gold up $1.30, or 0.1%, at $1,858.80 a troy ounce." September 9, 2011.
  • Standard & Poor's. "S&P 500 Index [SPX] Historical Prices." September 9, 2011.
  • ICE (Intercontinental Exchange). "ICE Dollar Index [USDX] Value." September 9, 2011.
  • Tatyana Shumsky. Email to Dow Jones Newswires. "Gold Prices Edge Higher as Stocks Stumble." September 9, 2011.