Gold is on the rise in morning trade Thursday as persistant worries about the contagion effect of Greece's debt crisis increased the yellow metal's allure as a safe haven.
While the dollar's rise against the euro has made gold more expensive for many investors and may put a damper on any further significant gains, the precious metal is becoming more attractive as a hedge against sovereign credit risk which appear to be increasing.
At 0810 ET, gold is up 0.8% at $1,184.30 an ounce, while silver is up nearly 1% at $17.70 an ounce, and copper is up 0.1% at $314.10 a pound.
On the corporate front, Randgold Resources Ltd. ( GOLD ) reported first quarter profit soaring 83% from a year ago, but the results still missed analysts' expectations. Net profit reached $23.9 million, up from $13.1 million during the same period in 2009, but analysts polled by Reuters on average had expected the figure to reach $27.8 million. The lower-than-expected results were partly due to lower production at Randgold's Loulo mine in Mali, and plant breakdowns at its Morila mine.
Petropavlovsk plc ( PPLKF ), meanwhile, reported a 37% fall in gold output to 65,600 ounces as planned expansion work disrupted production. For the full year, however, the gold miner formerly known as Peter Hambro Mining sees output reaching between 670,000 and 760,000 ounces as expansion plans take effect. In 2009, output reached 486,000 ounces.
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