Gold Ends Sharply Higher On Safe Haven Appeal

(RTTNews) - Gold futures ended higher for a second straight session Thursday, with investors seeking the safe haven appeal of the precious metal due to weakness in global equity markets and after the Malaysian Airlines plane crash in eastern Ukraine, near the border with Russia.

A disappointing report on U.S. housing starts also contributed to gold's sharp uptick with the dollar trending lower.

Amid worries over the impact of new sanctions imposed on Russia by the U.S. and European Union, fresh tensions surfaced in Ukraine after a Malaysian Airlines passenger jet crashed in the rebel-dominated area of eastern Ukraine, close to the border with Russia. Over 300 people are feared dead in the crash.

Meanwhile, some news reports suggest the aircraft may have been shot down at a height of about 33,000 feet with a surface-to-air missile. However, the State Department said it could not currently confirm the cause of the Malaysian Airlines plane crash.

Gold for August delivery, the most actively traded contract, jumped $17.10 or 1.3 percent to close at $1,316.90 an ounce on the Comex division of the New York Mercantile Exchange on Thursday.

Gold for August delivery scaled an intraday high of $1,325.90 and a low of $1,298.10 an ounce.

On Wednesday, gold futures ended higher on some upbeat economic data from China with the country's gross domestic product rising more than expected in the second quarter, bouncing back from a four-week low.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, edged down to 806.03 tons on Thursday from its previous close of 808.73 tons on Wednesday.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 80.49 on Wednesday, down from its previous close of 80.53 late Wednesday in North American trade. The dollar scaled a high of 80.59 intraday and a low of 80.47.

The euro traded higher against the dollar at $1.3526 on Thursday, as compared to its previous close of $1.3525 late Wednesday in North American trade. The euro scaled a high of $1.3540 intraday and a low of $1.3518.

In economic news from the U.S., a report from the Labor Department showed initial jobless claims to have declined by 3,000 to a seasonally adjusted 302,000 in the week ended July 12. Economists expected jobless claims to increase to 310,000 in the week.

Data from the Commerce Department showed new residential construction in the U.S. to have unexpectedly dropped in June, falling 9.3 percent, to a nine-month low of 893,000 from the revised May estimate of 985,000. Economists had expected housing starts to climb to 1.020 million in the month.

Building permits fell 4.2 percent to an annual rate of 963,000 in June from the revised May rate of 1.005 million.

Meanwhile, the Philadelphia Federal Reserve's Business Outlook Survey indicated a continued expansion in the region's manufacturing sector in July, with the index of activity in the sector jumping to 23.9 in July, its highest level in over three years.