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Metals Stocks: Gold futures head slightly higher, look to eke out a weekly gain

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Gold futures moved slightly higher on Friday, with the precious metal eyeing its first gain in four sessions and staying on track to eke out a back-to-back weekly advance.

Bullion has been buoyed this week, at least partly, by a downturn in stocks, with the Dow Jones Industrial Average
DJIA,
+0.51%

and S&P 500
SPX,
+0.58%

nearly erasing all of August’s gains, amid growing concerns about the economic impact of the spread of the delta variant of the coronavirus.

“Gold remains offered near the $1,800 per ounce, but rising volatility, and a further turmoil in equities could reverse the sentiment and trigger important gains in the yellow metal,” wrote Ipek Ozkardeskaya, senior analyst, at Swissquote.

On Friday, December gold
GCZ21,
+0.12%

edged up $1.50, or nearly 0.1%, at $1,784.60 an ounce, after slipping 0.1% on Thursday. Some analysts see $1,790 as a resistance price for bullion that it has struggled to overcome recently.

Amplifying the concerns about the economy has been fears that the Federal Reserve will begin unwinding parts of their easy-money programs later this year, despite the uncertainty stemming from the renewed spread of COVID.

Meanwhile, silver for September delivery
SIU21,
-0.67%

was off 26.5 cents, or 1.1%, at $22.97 an ounce, and headed for its fourth straight loss, following a 0.8% decline on Thursday.

For the week, silver is on track for a weekly decline of 3.5%, its third straight; meanwhile, gold futures are aiming for a weekly advance of 0.4%, its second in a row.

While the December gold contract has managed to hold within striking distance of the $1,800 level throughout this week, the “charts present lower highs and lower lows into the last trading session of the week,” analysts at Zaner wrote in Friday’s daily commentary. “Unfortunately for the bull camp, the dollar index overnight forged another fresh higher high for the move,” with the ICE U.S. Dollar Index
DXY,
+0.02%

having traded at its highest since November.

At its low on Thursday, the front-month August gold contract was more than $100 above its low from Aug. 9, suggesting that the gold market has “‘air,’ or flight to quality premium injected into prices,” they said.

Among the other Comex-traded metals, September copper
HGU21,
+2.00%

tacked on 1.9% tp $4.12 a pound, with prices for the most-active contract poised for a weekly loss of more than 6%. October platinum
PLV21,
+1.47%

rose 1.5% to $985.50 an ounce, trading around 4% lower for the week, and September palladium
PAU21,
-0.89%

fell 1.1% to $2,273 an ounce, looking to suffer a weekly decline of over 10%.

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