Stockerati

When investors panic, they turn to things tangible– gold and silver! The Iranian nuclear program just exacerbated the paranoia. From Bloomberg

Gold rose to the highest in almost 10 weeks on speculation that mounting tensions over Iran’s nuclear program will spur investor demand for a haven from market turmoil. Silver also gained.

Crude-oil futures, which doubled to a record in the past year, jumped as much as 2.4 percent today after ABC News reported Israel is likely to attack Iran, OPEC’s second-largest producer. The Dow Jones Industrial Average has tumbled into bear-market territory. Gold has rallied 45 percent in the past year, and UBS AG forecast a higher average price for the metal.

“Gold is always a safe-haven asset,” said Matt Zeman, a metals trader at LaSalle Futures Group Inc. in Chicago. “You’ve got inflation, geopolitical risk, extremely high oil prices and a weak economy. All the pieces of the puzzle are there for gold to go higher.”

Gold futures for August delivery climbed $16.20, or 1.7 percent, to $944.50 an ounce on the Comex division of the New York Mercantile Exchange, the highest closing price for a most-active contract since April 16.

Silver futures for September delivery climbed 78 cents, or 4.5 percent, to $18.29 an ounce. It was the biggest percentage gain for a most-active contract since March 5. The metal rose 1.2 percent in the second quarter while gold gained 0.7 percent.

Israel may bomb Iran if the Persian Gulf nation acquires enough uranium to build a weapon, potentially threatening Mideast oil supplies, ABC said, citing a Pentagon official it didn’t name. The 30-stock Dow Industrial average fell as much as 1.5 percent, surpassing the 20 percent decline from its recent peak, in October, that can signal the start of a bear market.

Almost a quarter of the world’s oil flows through the Strait of Hormuz, a narrow waterway between Iran and Oman at the mouth of the Persian Gulf.