Precious Metals Rise as Consumer Sentiment Sinks

On Friday, gold (NYSEARCA:GLD) futures for April delivery, the most active contract, increased $1.90 to close at $1,592.60 per ounce, while silver (NYSEARCA:SLV) futures for May edged 4 cents higher to finish at $28.85. Gold closed the week about 1 percent higher.

Both precious metals received support as the Labor Department said the cost of living in the United States logged its first increase in four months in February. The consumer-price index gained 0.70 percent, beating estimates for a 0.50 percent rise.

Meanwhile, the index of consumer sentiment compiled by Thomson Reuters and the University of Michigan plunged to 71.8 in March, compared to 77.6 in February. It is still a preliminary reading, but it is the lowest level of sentiment since December 2011. On average, economists projected the index to come in at 78.0, according to the median estimate of 67 economists surveyed by Bloomberg. This is the biggest miss of expectations on record.

In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) increased 0.30 percent, while the iShares Silver Trust (NYSEARCA:SLV) edged 0.10 percent higher. Major gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Newmont Mining (NYSE:NEM) increased 0.45 percent and 0.10 percent, respectively. Endeavour Silver (NYSE:EXK) jumped more than 2 percent.

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Disclosure: Long EXK, AG, HL, PHYS