Gold futures on Tuesday posted the highest close since early November, with analysts pinning the gain in part on haven investment demand sparked by Mideast tensions.
Gold for August delivery GCQ7, -0.19% rose by $14.80, or 1.2%, to settle at $1,297.50 an ounce. Prices extended their streak of gains into a third-consecutive session and finished at the highest for a most-active contract since Nov. 4, according to FactSet data.
Traders already had been expected to favor safety plays in this action-packed week, said Naeem Aslam, chief market analyst at ThinkMarkets, in a note. There are three Thursday events sparking worries: a European Central Bank announcement, the U.K. general election and former Federal Bureau of Investigation boss James Comey's testimony before a Senate panel. The panel is investigating Russian efforts to interfere in last year's presidential race.
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But this week also has brought a rift between Qatar and other Mideast nations, helping to further boost gold's appeal as a hedge against uncertainty.
"The conflict between Saudi Arabia and Qatar has taken this trade to another level altogether," Aslam said. "Markets across the Middle East have been rattled by this news and the shining metal is in massive demand."
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Weakness in the U.S. dollar, with the ICE U.S. Dollar Index DXY, +0.07% edging down by 0.3%, and some losses among U.S. equities, helped to lift investment demand for gold as well.
"Every thing is going right for gold with a weaker U.S. dollar against the Japanese yen, and Qatari risk also supporting bulls," said Chintan Karnani, chief market analyst at Insignia Consultants.
Some traders are buying gold on the belief that after a "probable interest-rate hike" at the Federal Reserve's monetary policy meeting next week, the central bank's statement will offer a "soft" tone, as far as interest-rate increases are concerned for the rest of the year, he said.
"Fundamentals are positive for gold with a big jump in physical gold demand in India and China in the month of May," Karnani said. "Personally, I will be looking for signs of correction on Thursday" when the U.K. starts its election.
Among other metals, July silver SIN7, -0.20% rose 12.9 cents, or 0.7%, to $17.71 an ounce, while July copper HGN7, +0.20% ended at $2.547 a pound, down 1.1 cents, or 0.4%. July platinum PLN7, -0.20% added $5.70, or 0.6%, to $963.30 an ounce and September palladium PAU7, -0.04% rose $6.55, or 0.8%, to $848.40 an ounce.
The SPDR Gold Trust GLD, +1.13% was up 1.2%, while the iShares Silver Trust SLV, +0.78% tacked on 0.7%. The VanEck Vectors Gold Miners exchange-traded fund GDX, +4.66% climbed by 4.3%.