Gold Prices Increase On Short-Sale Coverings

Wed., Oct. 6, 1999

From Staff

Gold prices rose another $17 in late London trading Tuesday, closing at $331 an ounce. The price in New York was $324 an ounce.

After languishing at 20-year lows throughout the summer, gold prices began rising last week following an announcement that European central banks agreed to cap gold bullion sales.

Tuesday’s increase was triggered by short-sale coverings, said Vanessa Motto of CPM Group, a New York precious metals research company.

Commodity traders who anticipated a decline in gold prices are now buying to cover their short-sale positions. That increased demand for gold, and boosted prices, Motto said.

But stock prices for local companies - which jumped sharply last week - have leveled. Coeur d’Alene Mines shares closed at $5.25 a share, a 2 percent gain. Hecla Mining Co. dropped 2 percent to $3.06-1/4 a share.

Motto said coin dealers are also reporting increased sales of gold coins, due to Y2K concerns.

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Gold Prices Increase On Short-Sale Coverings

Jesse Tinsley

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