futures rise

Gold futures rise early in NY on fund buying
Wed Feb 21, 2007 10:41am ET
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NEW YORK, Feb 21 (Reuters) - U.S. gold futures rebounded early on Wednesday, after dropping almost 2 percent in the previous session, boosted by fund buying and steadying oil prices.

At 10:16 a.m. EST (1516 GMT), most-active gold for April delivery on the COMEX division of the New York Mercantile Exchange was up $3.40 at $664.40 an ounce, trading in a tight range between $660.50 and $666.00.

Bernard Hunter, director of precious metals marketing at ScotiaMocatta, said that gold traded higher because of buying after Tuesday's correction and an early turnaround in crude oil prices.

Good fund buying was seen overnight after the Bank of Japan raised rates by a quarter percentage point to 0.5 percent, Hunter said.

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Hunter described spot gold's trading as a battle between prices above and below $660 an ounce.

"Certainly, the up-trend is still intact. But I think it's important for the market to get back above $660 if it's going to continue that up-trend," Hunter said.

Spot gold was quoted at $660.80/1.80 an ounce, down from $658.40/9.15 an ounce, its late Tuesday quote in New York. London's afternoon fix was $661.25.

Oil prices edged lower after rising early, pushed upward by technical buying but struggling to break above the narrow range that has persisted this month