By Myra P. Saefong, CBS.MarketWatch.com Last Update: 10:00 AM ET Oct. 8, 2004 E-mail it | Print | Discuss | Alert | Reprint | RSS
SAN FRANCISCO (CBS.MW) -- Gold futures soared above $425 an ounce Friday morning for the first time in six months as a weaker-than-expected U.S. jobs report fueled a steep drop in the dollar.
The "weaker job growth than forecasted, combined with falling consumer confidence, runaway energy prices and constant geopolitical tensions worldwide, have given gold all the ingredients necessary for a run to new highs in the coming days and weeks," said Peter Grandich, editor of The Grandich Letter, an investment advisory publication.
Data on U.S. employment Friday showed that the economy added fewer jobs than expected in September. See full story.
The news sent the dollar reeling and that, in turn, sent more investors to gold as a hedge against financial losses. See full story.
Against this backdrop, gold for December delivery climbed as high as $426 an ounce on the New York Mercantile Exchange, level the futures market hasn't seen since April 13. The contract was last at $424.10, up $4.60.
"Gold is just incredibly strong on the back of the dollar getting pounded and growing fears of instability in various regions around the world," said Kevin Kerr, a senior trader at Kwest International.
"Gold is also getting a boost form the rest of the metals complex including industrial metals like copper," he said.
And with interest that high, it's likely that $428 is the next key target, he added.
At the same time, December silver tacked on another 9.3 cents to trade at $7.31 an ounce, trading at levels not see since mid March. And December copper climbed 3.45 cents to $1.462 a pound, a level not seen in the futures market since 1995.
Elsewhere in the metals market, December palladium traded at $237.75 an ounce, up $4.30, while the January platinum contract rose 20 cents at $838.50 an ounce.
In equities, major metals mining indexes headed higher, mirroring strength in the metals futures.
The Philadelphia Gold and Silver Index (XAU: news, chart, profile) rose 2.6 percent to 104.77 points, while the Amex Gold Bugs Index (HUI: news, chart, profile) stood at 238.63, also up 3.1 percent. The CBOE Gold Index (GOX: news, chart, profile) added 2.7 percent to 92.20.
Among individual stocks, Freeport McMoRan Copper & Gold (FCX: news, chart, profile) moved 10 cents higher to close at $41.10 after Prudential Equity Group raised its earnings estimate for the metals producer, citing favorable pricing and production trends. See full story.
Newmont Mining (NEM: news, chart, profile) saw its stock fall 50 cents to close at $45.60. Indonesian prosecutors will consider whether to charge five Newmont Mining executives who have been jailed since Sept. 22 for investigation into possible illegal dumping of toxic waste, the company said Thursday.
