Exchange traded funds that invest in precious metals and mining stocks were among Monday’s biggest ETF winners as gold futures rose to a fresh record north of $1,600 an ounce, while silver prices climbed back above $40 an ounce on global debt concerns.
ETFS Physical Swiss Gold Shares (NYSEArca: SGOL) rose nearly 1% along with the yellow metal. Also Monday, ETFS Physical Silver Shares (NYSEArca: SIVR) added nearly 3%, while in mining stocks Global X Silver Miners (NYSEArca: SIL) climbed 2.4%. [Miner, Silver ETFs Pick Up Momentum]
Gold also hit new records when priced in euros and British pounds, said Daniel Wills and Nicholas Brooks in a weekly update Monday from ETF Securities.
Officials in the U.S. and European Union “continue to struggle to find solutions to their respective sovereign debt problems, driving investors into perceived safe havens,” they wrote.
EU leaders are scheduled to meet this week to sort out a second bailout for Greece as they try to contain Europe’s debt crisis.
“Meanwhile, Standard & Poor’s became the second rating company to put a warning on the U.S.’s top credit rating last week as Republicans and Democrats struggle to find consensus on how to pare the U..S government budget deficit as the Aug. 2 deadline to raise the U.S. government debt ceiling draws closer,” ETF Securities noted.
Silver has doubled the gains of gold over the past month and often acts as a leveraged play on gold prices, the analysts said.
“Silver prices hit their highest level since early May last week as the metal capitalized on the recent resurgence in gold prices,” they wrote. “The metal also may have benefited from market speculation that ‘QE3’ remains a possibility. Fed Chairman Bernanke refused to rule out a third round of quantitative easing in testimony to Congress last week, although he later clarified that any such program is not imminent.” [S&P 500 ETF Tries to Hold Support]
ETFS Physical Swiss Gold Shares
ETFS Physical Silver Shares
