LOS ANGELES (MarketWatch) — Gold prices held steady on Monday, starting off the week just slightly in the red as a lineup of notable quarterly reports, including more than a third of the Dow companies, will likely shape equities trading in the coming days.
At last check, gold for December delivery GCZ4, +0.15% was up $1.10 to $1,240.30 an ounce. December silver SIZ4, +0.25% added 4 cents to $17.38 an ounce.
In the previous session, gold ended lower amid a huge rebound push for equities. Still, prices closed with a weekly gain as mounting fears of slowing global growth gripped investors and sent them seeking safety.
Analysts at Sharps Pixley pointed out that holdings in the U.S. SPDR gold trust rose last week after having dropped four straight weeks. Trading volume in China rose to its highest level since May 2013, and demand for gold in India has also improved.
“While the sentiment towards gold has been soured given little inflationary pressure,” the analyst wrote, “the global equity rout and the on-going geopolitical risks have led to a rising demand for gold as an uncertainty and a portfolio hedge.”
Meanwhile, analysts at Barclays noted that the Indian festival of Diwali starts this week -- it’s considered an auspicious time to buy gold. The analysts said more physical demand will be needed for gold if the precious metal is going to “overwhelm the gold-negative external drivers,” and as such they say they’re still looking to short this rally.
As for investor flows, Barclays said gross long positions on gold are at their highest since July, but gross shorts are at the highest since December, which leaves scope for a short-covering rally. Views are also becoming divided on gold, said analyst Suki Cooper and others in a note.
Elsewhere in metals trading, January platinum PLF5, +0.64% and December palladium PAZ4, +0.18% both rose less than 1% each while high-grade copper for December delivery HGZ4, -0.52% shed a penny to drop to $2.99 a pound.
