Silver up 2pc as new year rekindles risk appetite
Singapore, January 3, 2012
Spot silver jumped more than 2 percent on Tuesday, leading gains in the precious metals complex as investors returned to the market in the new year with renewed appetite for risk.
Cash silver rose as much as 2.1 percent to $28.39 an ounce, before easing slightly to $28.21 by 0106 GMT.
The metal, with extensive industrial applications, lost nearly 10 percent in 2011 as worries about the global economy weakened prospects of industrial metals.
Although the global economy still faces uncertainties, investors are prepared to increase bets on riskier assets such as commodities after the year-end credit tightness forced many of them to the sidelines of the market.
'Silver is one of the more appealling trades of the new year, after a lot of positions have been emptied out,' said a Singapore-based trader.
'Now the turn of the year has happened and we will probably see silver back on radar screens for some accounts, especially those with healthy tolerance for risk.'
Managed money cut net length on US silver futures and options to 6,200 lots in the week ended December 27, its lowest in more than three years, according to data from the US Commodity Futures Trading Commission.
Spot gold gained 0.4 percent to $1,571.89 an ounce, after posting a 10-percent rise in 2011. US gold also rose 0.4 percent, to $1,573.70. - Reuters