11.07.2014 - Gold rose due to increased risks in the financial sector of the euro area
The price of gold rose yesterday amid growing risks for investors that has been connected on the one hand with the situation in Portugal, where one of the country's largest banks Banco Espirito Santo has not paid interest on the bonds and may declare a default or seek help from the authorities. On the other hand Israel has mobilized 20 thousand people and can initiate a ground operation in Palestine. Demand for gold in Asia remains weak, but investment funds continue to buy the yellow metal. We maintain a positive medium-term outlook for gold with the objectives of 1350 and 1,365 dollars per troy ounce.
The price of U.S. benchmark Light Sweet crude oil after nine sessions of decline rose on profit taking. We recall that prices fell amid falling geopolitical tensions related to Iraq and Ukraine, and in connection with the opening of two major ports in Libya to export oil. The decline in industrial production in Europe also resulted in fear of falling of oil demand. We expect that the price of oil will stabilize in the near future around the level of 102.00 dollars per barrel, after which we will need to expect new signals for opening positions.