Precious Metals Extend Rally, Turn Positive for the Week

Gold and silver futures extended their gains Friday afternoon as the U.S. dollar weakened further after this morning’s worse than expected jobs report.

COMEX gold futures, per the August 2012 contract, settled higher by $57.90, or 3.7%, at $1,622.10 per ounce.  The advance marked the yellow metal’s best day for a most actively-traded contract since last August.  Furthermore, gold turned higher on the week, by 3.4%.

Silver futures climbed as well, with the July 2012 contract finished up by $0.76, or 2.7%, at $28.51 per ounce.  In doing so, silver returned to positive territory for the week as well, albeit by only 0.4%.

Gold and silver equities also continued their ascent alongside precious metals this afternoon, with the Philadelphia Gold & Silver Index (XAU) jumping as much as 6.5% to 163.84.  Two of the top performing XAU components were Randgold Resources (GOLD) and Royal Gold (RGLD) – which soared by 9.2% to $86.64 and by 10.0% to $74.41 per share, respectively.

Commenting on the disappointing non-farm payrolls data and its implications for financial markets, Richard Hastings – a macroeconomic strategist at Global Hunter Securities – contended that “not only would there be more speculation about [a third round of quantitative easing] … but all of the data speak to tax revenue dilemmas due to growth limitations, and this means the U.S. budget comes back into focus.  If this occurs, then gold could rally this summer.”