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* Gold down 2% for the month
* Money up 6.3% is biggest weekly gain since mid-December
* Palladium on track for biggest monthly drop since April
* Interactive graph tracking the global spread of the coronavirus: tmsnrt.rs/3mvcUoa (New, updates prices, market activity and comments)
Jan. 29 (Reuters) – Silver continued a meteoric rally on Friday, taking gains to around 10% since messages began circulating on Reddit on Thursday morning urging retail investors to pile into the market and drive up prices.
The surge in silver rubbed off on gold, which jumped to 2%.
Both were also helped by a weaker dollar, which made them cheaper for buyers of other currencies, and by the fall in stock markets.
Silver climbed to 7% Thursday after calls appeared on Reddit to buy silver mining stocks and iShares Silver Trust, an exchange-traded fund (ETF) backed by physical silver bullion, in a GameStop style.
Some silver traders hedged short positions to avoid being caught by the price increase, while some mining stocks surged and iShares Silver trading nearly quadrupled.
Buying the ETF can support silver prices by increasing the number of shares in the fund and forcing its trader to buy more metal to support them.
Analysts said they expected the rally to be short-lived, with the size of the market making it much less easy to influence than companies like GameStop.
“We are convinced that the influence of retail investors on silver will not last that long, and that ultimately industrial and institutional demand will be the key driver in the long run,” said the analyst. Commerzbank Eugen Weinberg in a note.
At 11:16 a.m. EST (4:16 p.m. GMT) on Friday, silver was up 2.4% to $ 26.99 an ounce, on its way to its best weekly gain since mid-December, at over 6%.
Standard Chartered analyst Suki Cooper said she expected strong demand for silver from investors and industry to push prices up to $ 30 in the first half of 2021.
Spot gold, meanwhile, rose 0.9% to $ 1,856.59 an ounce, with US gold futures up 1.1% to $ 1,860.60.
But gold was on track for its worst January since 2011, which many analysts attribute to the strengthening dollar and increasing investor focus on assets that will benefit from the economic recovery.
Platinum rose 0.4% to $ 1,074.56, while palladium fell 4.8% to $ 2,223.59.
Reporting by Asha Sistla and Arpan Varghese in Bengaluru, Peter Hobson in London; Edited by David Gregorio
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