Gold futures on the COMEX division of the New York Mercantile Exchange rose on Wednesday as U.S. equities plummeted on a sharp decline in oil prices.
The most active gold contract for February delivery rose 17.1 U. S. dollars, or 1.57 percent, to settle at 1,106.20 dollars per ounce. Gold was given extensive support as the U.S. equities market plummeted in the wake of declining oil prices, triggering a massive devaluation of U.S. energy companies.
The West Texas Intermediate for February delivery slipped below 27 U.S. dollars a barrel in midday trading on the New York Mercantile Exchange. By noon, the Dow Jones Industrial Average plunged 458.29 points, or 2.86 percent, to 15,557.73.
The S&P 500 sank 56.09 points, or 2.98 percent, to 1,825.24, the lowest level since February 2014. Analysts noted that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven. The precious metal was given further support as the U.S. Department of Labor's consumer price index (CPI) reading released on Wednesday showed the CPI decreasing by 0.1 percent in December, but the core rate increased by 0.1 percent.
The figure, analysts said, is in line with what the U.S. Federal Reserve was expecting. However, traders are likely to be cautious, as inflation remains weak. Silver for March delivery rose 3.9 cents, or 0.28 percent, to close at 14.16 dollars per ounce. Platinum for April delivery fell 11.1 dollars, or 1.34 percent, to close at 819.20 dollars per ounce.
Latest comments