Oct. 12 (Bloomberg) -- Gold futures rose to a two-week high as equities and commodities rallied amid optimism that European officials will tame the region’s debt crisis.
The MSCI All-Country World Index rose 2 percent, while the Standard & Poor’s GSCI index of 24 raw materials headed for the longest rally in six months. European Economic and Monetary Affairs Commissioner Olli Rehn said that countries are moving toward a consensus on resolving the “calamity.” Slovakia, the only nation that hasn’t ratified a revised bailout fund, was poised for a second vote after rejecting the package yesterday.
“We are seeing a return of risk-on trade,” Fred Schoenstein, a trader at Heraeus Precious Metals Management in New York, said in a telephone interview. “Europe is working toward finding a solution.”
Gold futures for December delivery climbed 1.3 percent to settle at $1,682.60 an ounce at 1:41 p.m. on the Comex in New York. Earlier, the metal reached $1,693.90, the highest for a most-active contract since Sept 23.
Physical demand was “decent” yesterday, UBS AG said in a report. Consumption in India, the world’s biggest gold buyer, may climb on jewelry purchases for the Diwali religious festival later this month, followed by the wedding season.
The metal has gained 18 percent this year, reaching a record $1,923.70 on Sept. 6, on demand for an investment alternative to equities and some currencies.
Silver futures for December delivery rose 2.5 percent to $32.789 an ounce. The metal advanced for the third straight day, the longest rally in seven weeks.
On the New York Mercantile Exchange, platinum futures for January delivery rose 2.3 percent to $1,554.40 an ounce. Palladium futures for December delivery climbed 1.1 percent to $611.10 an ounce.
--With assistance from Nicholas Larkin in London. Editors: Patrick McKiernan, Steve Stroth
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