Updated from 12:02 p.m. EST
Gold climbed Tuesday as stocks calmed and bargain hunters took advantage of the relatively tranquil market to buy bullion.
Contracts for April delivery of gold rose $7 to close at $646.20 an ounce on the Comex divison of the Nymex. The gold exchange-traded funds,
iShares Comex Gold Trust
streetTracks Gold Shares
, both were gaining about 1.7% recently.
"With gold back under $650, the physical sector is quite keen to take a look at buying again," says James Moore, an analyst at
"But I still think we have some more weakness to come," he adds, explaining that large-scale speculative interest has made the market more susceptible to adverse events in the broader financial markets rather than just the activity on futures bourses.
Any significant selloffs in equities could spark another bout of bullion sales, he says.
Elsewhere, foreign-exchange dealers seemed to greet weaker-than-expected data on productivity and factory orders with a shrug, leaving the greenback mixed for the day. One dollar was recently buying 116.6 yen, up from 115.83 yen late Monday. One euro was buying $1.3114, compared with $1.3093 previously.
Back in gold, at least one technical analyst says traders are searching the charts for signs of direction, with the recent slide having broken the prior uptrend. Spot prices rallied from a January low of $608 to flirt with the $690 level in late February before selling off last week.
"Only if the price can get back above resistance at $653 will the uptrend resume," says Larry Levin, president of
, in Chicago. He sees support at around $636, which if breached leaves open the possibility for a fall through to $605.
In the official sector, the European Central Bank said it sold 34 million euros of gold and receivables last week, or about 2 tons.
On this side of the Atlantic, the U.S. Mint said sales of its bullion coins fell in February compared with the prior month. Dealers purchased a combined 41,500 ounces of the Mint's 22-karat (91.7% pure) eagles and 24-karat (99.99% pure) buffalos last month, compared with 53,500 ounces in January.
In the mining patch, UBS upped its rating on shares of
to buy from neutral, sending the stock up 3.4% in afternoon action.
was rising 2.2%, buoyed by the rising metal price.
Turning to base metals, copper contracts closed up 4 cents at $2.71 a pound on the Comex.
As for ferrous metals, Jeffries initiated coverage of
Claymont Steel Holdings
with a buy rating and a stock price target of $24 a share. Still, the stock was off 1.7% to around $19 in recent activity.