Gold Rises as Rally in Crude Oil Spurs Investor Demand for Metal

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Gold climbed as higher energy prices damped concern that inflation will remain low and revived demand for the precious metal as a store of value.

Crude futures in New York advanced for the second time in three days. The correlation between gold and oil rose close to 0.4 today, the strongest link since July 2013. A reading of 1 means the prices move in lockstep.

A whipsaw in oil is spurring the biggest price swings for gold in almost nine months. Commodity traders often track energy prices and their impact on consumer costs. In November, the metal slumped to a four-year low as the dollar rallied and demand ebbed for an inflation hedge after crude tumbled.

Gold futures for February delivery rose 0.8 percent to settle at $1,208.70 an ounce at 1:47 p.m. on the Comex in New York. The 60-day volatility climbed to the highest since March.

Oil has collapsed into a bear market as U.S. output climbed to the highest in more than three decades amid signs of sagging growth in world demand. Through yesterday, Brent crude tumbled 36 percent this year, the biggest drop among 22 raw materials in the Bloomberg Commodity Index. Federal Reserve officials have said that lower energy prices may hold down consumer costs in the near term.

Source : Bloomberg

Euro Slides to 2-Year Low Before ECB

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The euro slumped to a two-year low versus the dollar as mounting signs of weakness in the regions economy amplify calls for the European Central Bank to ease further when it meets tomorrow.

The dollar touched a seven-year high against the yen as a private report showed U.S. employers added at least 200,000 for the seventh time in eight months. The greenback reached a four-year high versus the Aussie as Goldman Sachs Group Inc. joined Deutsche Bank AG in predicting an interest-rate cut after Australian growth missed forecasts. Russias ruble bounced from a record low amid speculation the central bank intervened to support the currency.

The euro tumbled 0.6 percent to $1.2309 as of 10:01 a.m. New York time, touching the weakest level since August 2012. The dollar rose 0.4 percent to 119.72 yen after reaching 119.75, the highest since August 2007. The euro weakened 0.2 percent to 147.34 yen.

Source : Bloomberg

U.S. Stocks Climb to Records as Commodities Producers Advance

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U.S. stocks rose, sending the Standard & Poors 500 Index to an all-time high, as industrial and commodity shares rallied while data boosted confidence in the economy before Fridays jobs report.

The S&P 500 rose 0.4 percent to 2,074.18 at 4 p.m. in New York. The Dow Jones Industrial Average extended a record, climbing 31.27 points, or 0.2 percent, to 17,910.82. The Russell 2000 Index jumped 0.9 percent.

The S&P 500 climbed topped its record of 2,072.83 reached on Nov. 28, after weaker Black Friday sales and oil prices had dragged stocks lower. The gauge has rebounded 11 percent from a low in October amid optimism the economy is strong enough to withstand a slowdown overseas and tighter monetary policy after the Federal Reserve wound up its asset-purchase program.

Source : Bloomberg

Europe Stocks Climb Amid ECB Optimism as Commodity Stocks Rally

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Gains in miners helped propel European stocks to within 0.1 percent of a six-year high amid bets that the European Central Bank will expand stimulus.

The Stoxx Europe 600 Index increased 0.6 percent to 349.34 at the close of trading in London. Thats its highest level since June 10, and Rio Tinto Group pushed a measure of commodity companies to the biggest gain on the gauge. The gauge has rebounded risen 13 percent from an October low as President Mario Draghi said the ECB may broaden its asset-buying program to include government bonds, while central banks in Japan and China boosted measures to support their economies. The ECB will discuss monetary policy tomorrow.

Speculation has been rising that the ECB may move a step closer to full-scale quantitative easing. That has spurred investors to send money to a fund tracking the regions equities for the first time in five months.

Greeces ASE Index and Spains IBEX 35 Index rose more than 1 percent for the biggest gains among 18 western-European markets. The U.K.s FTSE 100 Index fell 0.4 percent as Chancellor of the Exchequer George Osborne raised a forecast for U.K. government borrowing.

Source : Bloomberg

U.S. Stocks Rise as Energy Stocks Surge Before ECB, Jobs Report

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U.S. stocks rose, following the biggest advance in a month for the Standard & Poors 500 Index, as energy shares rallied and payrolls and services data boosted confidence in the economy before Fridays jobs report.

Energy companies in the S&P 500 climbed 1.2 percent for a third straight advance as Cimarex Energy Co. and Oneok Inc. surged more than 4 percent. Consumer-staples stocks slipped the most in the U.S. benchmark gauge as Brown-Forman Corp. and Molson Coors Brewing Co. slumped 2.7 percent.

The S&P 500 rose 0.2 percent to 2,070.56 at 12:02 p.m. in New York, after climbing 0.6 percent yesterday. The Dow Jones Industrial Average climbed 8.64 points, or 0.1 percent, to 17,888.19. The Russell 2000 Index jumped 1 percent. Trading in S&P 500 companies was in line with the 30-day average for this time of the day.

The S&P 500 is climbing back to a record reached on Nov. 28 after weaker Black Friday sales and oil prices dragged stocks lower. The gauge has still rebounded 11 percent from a low in October amid optimism the economy is strong enough to withstand a slowdown overseas and tighter monetary policy after the Federal Reserve wound up its asset-purchase program. The Dow closed yesterday at an all-time high.

Source : Bloomberg