Gold Jumps On Short Covering & safe-haven buying

New York (May 12)   Gold prices bounced higher in early U.S. trading Monday as safe-haven buying and short covering are featured. Bears still possess the overall near-term technical advantage in both gold and silver markets. Spot gold was last up $9 at $1,301, while spot silver was up nearly 2% to $19.59

The Russia-Ukraine situation sees tensions still very high as the weekend saw a secession referendum vote taken in eastern Ukraine, in which the pro-Russia separatists won. The voting process was said by some observers to be chaotic. The government of Ukraine called the secession vote illegal and blamed Russia for stirring up more trouble. The Russian government said it would respect the weekend vote to secede. Meantime, the European Union is set to expand its sanctions against Russia, reports said. This matter remains a potential geopolitical powder keg and it appears the fuse is now lit. Gold has and will likely continue to see safe-haven buying amid the escalating Russia-Ukraine conflict.

World stock and financial markets were not overly exercised over the new developments in the Ukraine-Russia stand-off. Asian and European stock markets were slightly higher Monday and the U.S. stock indexes were also firmer in early electronic trading Monday.

There was no other major, markets-moving economic news from Asia or the European Union overnight.

U.S. economic data due for release Monday is light and includes the monthly Treasury budget statement. The U.S. economic report pace picks up significantly starting Tuesday.