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News Link • Economy - Economics USA

Gold Rises With Oil; Commodity Shares Lead S&P 500 Higher

• Debarati Roy & Susanne Walker

Gold climbed for a fifth day, the longest rally of the year, after the metal last week posted the biggest price slump in three decades. Oil rose and energy and raw-material producers led U.S. stocks higher.

Gold for immediate delivery rose 1.6 percent to $1,426.45 an ounce as of 5 p.m. in New York. The Standard & Poor’s 500 Index added 0.5 percent after slumping 2.1 percent last week, its worst drop since November. Ten-year U.S. Treasury yields lost one basis points to 1.69 percent. Italy’s note yields decreased as the country elected a president and the Stoxx Europe 600 Index climbed 0.2 percent. The yen gained for the first time in five days after failing to weaken through 100 per dollar, a level last reached four years ago.

Gold has rebounded after reaching a more than two-year low on April 15. The metal entered a bear market this month amid decreased demand for a hedge against inflation and concern struggling European nations will sell gold to raise cash. Data from the Shanghai Gold Exchange and the the U.S. Mint showed demand for gold has surged following the biggest price slump in three decades.

“Strong demand for physical gold is a major factor working to lift gold prices up from last week’s lows and beginning to suggest a market bottom is in place,” Jim Wyckoff, a senior analyst at Kitco Inc., a precious-metal refiner and research company in Montreal, said in a report.

Gold futures for June delivery jumped 1.8 percent to close at $1,421.20, the highest settlement since April 15.

Physical Demand

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