Gold Prices Rise Ahead of Presidential Debate (Update 1)

Updated from 10:59 a.m. EDT with settlement prices

NEW YORK ( TheStreet) -- Gold prices were slightly higher Wednesday but not much momentum as investors looked ahead to the first U.S. presidential debate of the election season.

Gold for December delivery rose $4.20 to close at $1,779.80 an ounce at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,784 and as low as $1,773 an ounce, while the spot price was rising $3.50, according to Kitco's gold index.

"I think here in the U.S. we're definitely focusing on the first presidential debate," said Tim Harvey, senior vice president at ETF Securities U.S. "If Obama wins, then I think most people think we're looking at ... not necessarily more quantitative easing, but more of the same."

If he wins the 2012 election, Republican presidential nominee Mitt Romney has said that he would unseat Federal Reserve Chairman Ben Bernanke. President Barack Obama has not expressed the same opinion, and Bernanke's term runs through Jan. 31, 2014.

An average of major national polls shows the president with a lead over his GOP opponent with Obama holding advantages in most of the battleground states.

Investors are keeping an eye on every campaign development to try and gauge who may win in November, and thus better position themselves for the policies that may emerge under the victor's administration.

Silver prices for December delivery closed up 2 cents at $34.69 an ounce, while the U.S. dollar index was gaining 0.29% to $79.98.

Developments in Greece and Spain continue to influence gold as well.

The so-called troika, which consists of officials from the International Monetary Fund, the European Union and the European Central Bank, has promised €240 billion to Greece.

"The troika is not necessarily functioning as a troika at the moment; I think the IMF is taking a harder line on Greece than the EU or the ECB has been taking," said Harvey.

Greek Finance Minister Yannis Stournaras pushed back the deadline of an agreement to Oct. 18 that the government and the troika were supposed to reach by Oct. 8.

Investors also continued to wait for a timeline on the potential request for bailout funds from Spain. More easing in the eurozone would be a positive for gold.

Though many market analysts see the open-ended easing measures from the Fed as a long-term positive for gold, one has suggested the recent boost could see a slight pullback in the near-term.

"Gold has been consolidating for almost three weeks, and normally right about at this time you will see a fairly significant move," said David Banister, chief investment strategist at TheMarketTrendForecast.com. "The rally from the low-$1,600s to the $1,780 area was a five-wave rally ... which are bullish, and they're usually followed by a three-wave correction."

Gold mining stocks were mostly lower Wednesday. Shares of AngloGold Ashanti ( AU) fell 4.5%, while shares of Gold Fields ( GFI) shrank 5%.

Among other mining stocks, Kinross Gold ( KGC) closed down 0.95%, and Barrick Gold ( EGO) decreased 1.2%.

Gold ETF SPDR Gold Trust ( GLD) gained 0.18%.

-- Written by Joe Deaux in New York.

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