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Prices for gold and other metals jumped Thursday, propelled by an encouraging report about China's trade growth.
Gold for February delivery rose $22.50, more than 1 percent, to $1,678 per ounce. March silver rose more than 2 percent, up 66.9 cents to $30.918 per ounce.
Alan Knuckman, chief market strategist at Optionshop in Chicago, said gold was turning around after the detrimental effect of the Federal Reserve minutes last week. Gold prices had slipped after the Fed disclosed that some of its board members disagree over how long the central bank should continue a bond-purchasing program.
The bond-buying program is intended to invigorate the economy, by keeping the return on bond investing low and thus encouraging investors to move into stocks. Such a program can also encourage inflation, though, and many investors buy gold because they think it will be a hedge against inflation. So when there were hints that some Fed members wanted to curb the bond-buying program sooner rather than later, gold fell.
Knuckman said Thursday that investors were realizing that they'd overreacted to the Fed disclosure. "They're not going to stop this cheap-money policy any time soon," Knuckman said, referring to the Fed's bond buying. "People read too much into those Fed minutes."
Also boosting metals prices were hints that the global economy could be improving. China's exports and imports rose, a sign of higher demand both inside and outside the country. Mario Draghi, head of the European Central Bank, said the struggling euro area should start growing again later this year.
That sent up prices for metals that are key to manufacturing. March copper rose 3.85 cents, or 1 percent, to $3.709 per pound. March palladium rose $14, or 2 percent, to $702.20 per ounce. April platinum rose $34.30, more than 2 percent, to $1,634.30 per ounce.
Energy prices were also up. Benchmark oil gained 72 cents to $93.82 a barrel in New York. It has now risen more than 9 percent in the past four weeks. Brent crude, used to price international varieties of oil, rose 13 cents to $111.89 per barrel in London.
Wholesale gasoline added 1 cent to $2.79 a gallon. Natural gas prices rose 8 cents, or 2.5 percent, to $3.19 per 1,000 cubic feet. The outlier was heating oil, which fell 2 cents to $3.05 per gallon.
Agricultural prices were less decisive. In March contracts, wheat was essentially flat, slipping 1 cent to $7.445 per bushel. Corn inched up 4.5 cents to $6.9875 per bushel. Soybeans fell 5.75 cents to $13.7975 per bushel.
This winter's late snows have made some traders concerned about the possibility of a second straight dry season, Knuckman said. Prices for all three grains soared last summer because of a devastating drought in the Midwest.