Gold futures rally toward a 5-week high – MarketWatch

Gold futures rallied on Thursday, poised for their highest settlement in nearly five weeks, with weakness in the U.S. dollar against most currency rivals and declines in global stock markets boosting the precious metal’s investment appeal.

The market also awaited comments from Federal Reserve Chairwoman Janet Yellen, who is slated to speak Thursday evening.

December gold

GCZ5, +1.92%

 tacked on $22.60, or 2%, to $1,154.10 an ounce on Comex, after snapping a two-day losing streak Wednesday. A settlement around this level would be the highest since Aug. 21.

December silver

SIZ5, +2.24%

added 26.1 cents, or 1.8%, to trade at $15.05 an ounce.

Gold’s rallying due to “safe-haven demand and [a] technical break out,” said Chintan Karnani, chief market analyst at Insignia Consultant.

From a technical perspective, gold is trading over $1,140 and needs to trade over that level “to attract short-term investors,” which would in turn help lift prices to $1,185 and $1,230, he said.

The U.S. dollar index

DXY, -0.31%

 edged lower against most other currencies after data showed weekly jobless claims inched higher but continued to hover near 40-year lows and durable-goods orders in August fell for the first time in three months.

“U.S. durable goods were mixed while jobless claims indicated the job markets remains robust, keeping uncertainty about what the Fed may do next running high,” said Colin Cieszynski, chief market strategist at CMC Markets.

Yellen will speak about inflation later Thursday, “which could attract a lot of attention from traders looking for hints of when the Fed could start raising interest rates,” he said. Yellen will deliver her speech at the University of Massachusetts at 5 p.m. Eastern time. Read: Don’t expect Yellen to offer clues on rate-hike timing Thursday

Higher rates are a boon to the dollar but a drag on dollar-denominated assets, including precious metals like gold, making them more expensive to buyers in other currencies and dulling the luster of assets that don’t bear interest.

U.S. equities, meanwhile, fell sharply Thursday, pressured by news of job cuts at Caterpillar Inc.

CAT, -6.27%

European and Asian stocks were also mostly lower.

Platinum prices, which have been hammered by the Volkswagen

VOW, +0.00%

VOW3, +0.58%

VLKAY, -0.92%

 scandal, were tipping higher but still hovering around six-year lows. The German car maker’s woes with diesel-powered cars have hit the precious metal used in catalytic converters.

In a Thursday research note analysts at Macquarie Capital said they expect VW’s problems put “further pressure on platinum,” and cut their fourth-quarter forecast for the precious metal by 2.5% to $975 an ounce. October platinum

PLV5, +2.68%

 gained $14.80, or 1.6%, to $947.20 an ounce in Thursday trading.

December palladium

PAZ5, +1.87%

which is used more often in gasoline-fueled cars, was up $4.65, or 0.7%, at $650.35 an ounce after a 5.7% jump on Wednesday.

Read: Volkswagen’s scandal is whacking platinum prices, lifting palladium

In other metals, December high-grade copper

HGZ5, +0.37%

 was nearly flat at $2.293 a pound.