Bullion metals drop

Gold and silver both lose as traders un optimist

After three consecutive days of gains, bullion metal ended lower on Thursday, 09 April, 2009. Prices fell as US stocks rallied today buoyed by good earnings forecast by Wells Fargo bank. This decreased the appeal of the precious metal.

Generally, a stronger dollar pressures demand for dollar-denominated commodities, such as crude oil and gold, which become more expensive for holders of other currencies and also vice versa.

On Thursday, Comex Gold for April delivery fell $2.6 (0.3%) to close at $882.2 an ounce on the New York Mercantile Exchange. For the week, gold ended lower by 1.5%. Year to date, gold prices are lower by 0.7%.

For the month of March, gold fell 2.1%, down for the first month in five. But the metal gained 4.3% in the first quarter. Before March, for the month of February, gold ended higher by 7.4%. For January, 2009, gold had gained 3.9%.

On 17 March, 2008 prices had skyrocketed to a high of $1,034/ounce. But prices have dropped somewhat (15.5%) since then.

On Thursday, Comex silver futures for May delivery ended almost unchanged at $12.33 an ounce. Year to date, silver has climbed 9.2% this year. For 2008, silver had lost 24%.

Today morning, Wells Fargo announced that in its first quarter earnings, it expects to earn $0.55 per share for the quarter against an expected $0.24 per share. Leadership from banks and other financial stocks helped bring about broad-based buying in each of the major indices.

In 2008, gold prices ended higher by 5.5%. The dollar index had gained 12% that year.