MW: Gold hits fresh high, as December contract tops $1,160
TOKYO (MarketWatch) -- Gold futures rallied in electric trading on late Monday morning in Asia, as safe-haven demand helped lift the December contract to a fresh high above $1,160 an ounce.
The gain extended a winning streak Friday in New York that's already spanned six straight sessions.
"It is an unbelievable rally," said Darin Newsom, a senior analyst at Telvent DTN.
"Buying seems to be coming from three sides: inflation hedge, safe-haven buying due to continued global economic concerns, and demand for paper (futures) coming from both commercial and noncommercial buying," he said. See Commodities Corner on gold's prospects.
Gold for December delivery, the most actively traded contract, climbed as high as $1,162.50 an ounce on Globex by late morning trading in Tokyo. It later eased slightly but was still up $14.40, or 1.3%, at $1,161.20.
On Friday, the contract rose by $4.90, or 0.4%, to $1,146.80 an ounce on the Comex division of the New York Mercantile Exchange, while the thinly-traded November contract rose 0.4% to $1,146.40, the highest level for a Comex front-month contract.
Newsom said he has an initial target for gold prices just short of $1,390.
He expects gold prices to reach his target price sometime in the first quarter of 2010.
"But given the momentum the market is seeing now, it could be by the end of December," he said.
Gold futures have made significant gains in the second half of this year. Benchmark gold futures contracts have soared more than 26% since their July low. Gold rose in 16 out of the 19 weeks since the week started July 17. See Friday's Metals Stocks.
