Nervous jitters about Iran's nuclear ambitions haven't only inflated crude oil prices. Gold, often seen as a safe haven in times of uncertainty, reached 25-year highs last week and remained on the upswing Monday.
In recent action, gold for April delivery was gaining $2 to $573.80 per ounce.
Among metal-mining stock indices, the Amex Gold Bugs Index was recently up 2.34%, led by big gains in
(AU - Get Report),
(HMY - Get Report) and
(GFI - Get Report).
The CBOE Gold Index was up 2% and the Philadelphia Gold and Silver Index was up 2.3%.
(ABX - Get Report)
was up 1.7% after saying it would raise its stake in
to 94%. Barrick offered to acquire Placer Dome in November 2005.
Broad indices, meanwhile, were mixed as oil prices rose and investors fret that the
may have to lift interest rates for longer than expected. The
Dow Jones Industrial Average
was recently up 1.76 point, or 0.02%, at 10,795. The
S&P 500 index
was up 0.07% at 1264 while the
was down 0.18% at 2258.
Just like crude (which was recently gaining 38 cents to $65.75 per barrel) gold's latest surge came after Iran said over the weekend it would resume uranium enrichment activities even as its case is being referred to the United Nations Security Council.
But unlike crude, gold isn't likely to pull back if those tensions ease. "Gold is in a bull market," says Brien Lundin, gold analyst at Jefferson Financial, and editor of
. "That means it responds positively to bullish news as investors are looking for excuses to buy."
For proof, there's no need to look further than the breakdown of a once-traditional inversion relationship between gold, which is priced in dollars, and the U.S. currency. A rising dollar used to depress gold prices, as it took less dollars to buy the same amount of gold. But, as it did all of last year, gold's latest push has occurred even as the dollar has been strengthening.