March 14: Vietnam gold rebounds VND300,000 on global gold surge

Vietnam’s gold prices on March 14 rallied to VND37.37million/tael, up VND300,000 from Saturday as global ones soared 1% following Japan’s devastating earthquake.

As of 8:45 a.m Hanoi time, Sacombank-SBJ gold as listed at VND37.16million/tael and VND37.34millionn/tael; while SJC was listed at VND37.25million/tael and VND37.37million/tael for bid and ask, respectively.

In Asian trade this morning, gold rose about 1% on Monday as Japan battled to prevent a nuclear catastrophe after a massive earthquake and tsunami, although declines in equities markets could also prompt investors to sell bullion to cover losses.

Spot gold added $9.60 to $1,427.30 an ounce by 0134 GMT after rising as high as $1,431.89 an ounce — still off a record high of $1,444.40 hit last week.

The world’s largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings edged down to 1,215.475 tons by March 11, their lowest since May 2010, from 1,217.295 tones on March 7, as some investors booked profits from gold’s rise to a record.

U.S. gold futures for April rose $6.2 an ounce to $1,428.0 an ounce. Japan’s equity futures fell 6% on Monday as investors took stock of the economic damage from the massive earthquake and tsunami that devastated the country’s northeastern region.

A badly wounded nation has seen whole villages and towns wiped off the map by a wall of water, bringing in its wake an international humanitarian effort of epic scale. More than 10,000 people are feared to have been killed.

“Some investors expect some of the Japanese insurance companies to start selling their dollar assets to raise money. Perhaps gold could be boosted as an alternative currency itself,” said Ong Yi Ling, investment analyst at Phillip Futures in Singapore.

“In the short term, I think gold prices will head up due to a flight to safety and investors seeking out a safe haven.”

In local money market, the dong held steady as the State Bank of Vietnam set daily reference rate at VND20,663, unchanged from Saturday. The currency is allowed to trade up to 1% on either side of that midpoint.

Vietnam has cracked down on unauthorized trading in U.S. dollars in an effort to bolster the country’s dwindling foreign reserves and restore confidence in the local currency.

Gold shops in local provinces closed dollar trading, following suit those in Hanoi and Ho Chi Minh fearing a crack-down where police will join hands to investigate illegal dollar trading. – Stoxplus.com

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