In the last trading day of the week, traders embraced a risk on posture and that was good news for gold. COMEX gold for August delivery added $3.40, or 0.2%, to settle at $1,591.40 a troy ounce. A positive end to a glum week, as Friday's moderate gains were not enough to help gold skirt a weekly loss. Nor were the gains enough to help the yellow metal reclaim the $1,600 an ounce level. The dollar once again hampered gold as the PowerShares DB US Dollar Index Bullish (NYSE: UUP) closed the week with a modest gain.
For the week, gold futures gave up almost 2% and much of that decline was due to some early-week retrenchment following last Friday's big gain for gold and then the Thursday disappointments following Federal Reserve Chairman Ben Bernanke's congressional testimony. Bernanke added little to the quantitative easing fire this week. If anything, he put it out, dampening hopes for a major near-term rally in gold prices.
Gold did get the benefit of some positive news out of Europe in what feels like the first time in eternity. Various media outlets reported today that Spain will ask Germany and the European Union for financial system for its ailing banks. To this point, Spain, the Euro Zone's fourth-largest economy, has been reluctant to recapitalize its banks.
Money managers increased their net long position in gold by nearly 30 percent in the week to June 5, Reuters reported, citing data from the Commodities Futures Trading Commission. Speculators boosted their net longs in gold by 21,101 to 98,426 lots and added their net longs in silver by 1,637 to 6,549 contracts, according to Reuters and the CFTC.
The iShares Gold Trust (NYSE: IAU) gained about a third of a percent while the SPDR Gold Shares (NYSE: GLD) shares 0.15%. On volume that was barely more than half the daily average, the iShares Silver Trust (NYSE: SLV) suffered a meager loss.
The ETFS Physical Platinum Shares (NYSE: PPLT) gave up 0.56%, also on volume that wasn't even half the daily average. The ETFS Physical Palladium Shares (NYSE: PALL) slipped 2% on volume that was less than a third of the usual turnover.
Despite light volume, Friday was the best day of 2012 for equities and this was the best week for all three major indexes since December 2011. The Global X Silver Miners ETF (NYSE: SIL) added 1% for the day and was up 3.4% in this week. The Market Vectors Gold Miners ETF (NYSE: GDX) gained three-quarters of a percent today, but that's how much it lost for the week. The Market Vectors Junior Gold Miners ETF (NYSE: GDXJ) gained a third of a percent.