Gold rebounds after 8-day slump as equity market extends losses

Special Report:Global Financial Crisis

CHICAGO, March 5 (Chinese media) -- Gold futures on the COMEX Division of the New

York Mercantile Exchange surged on Thursday for the first time in recent nine

sessions due to the increasing save-haven demand for gold as U.S. stock market

plunged again. Silver and platinum went up too.

Gold price for April delivery was up 21.10 U.S. dollars, or 2.3 percent, to

settle at 927.80 dollars an ounce. May silver closed at 13.12 dollars per ounce,

up 20.5 cents. April platinum gained 19.80 dollars to 1,064.60 dollars per

ounce.

The Dow Jones index plummeted 281 points to 6,594 points, the new lowest

level in 12 years, which was considered by the traders to promote precious

metals' demand for safety investment.

The European Central Bank cut its interest rate 50 basic points to 1.5

percent and indicated a further cut. Meanwhile the Bank of England cut its rate

50 basic points to the record lowest level of 0.5 percent. They both reminded

investors of the future inflation and its eroding effect on wealth,

strengthening the appeal of gold as safety choice.

Analysts indicated that technical short-covering gave gold some support to

rally after a huge decline since Feb. 20, when the precious metal touched as

high as 1,007.70 dollars per ounce and lost about 100 dollars in the following

eight straight sessions.