Gold hits 5-month high above $1200

By Blake Ellis, staff reporterMay 6, 2010: 3:46 PM ET

NEW YORK (CNNMoney.com) — Gold surged past the psychologically significant $1,200 mark on Thursday as stock markets plummeted and investors sought a safe haven.

What prices are doing: Gold for June delivery settled up $22.30, or nearly 2%, at $1,197.30 an ounce but climbed above $1,200 after its settlement, hitting the highest level since Dec. 4.

What’s moving the market: Investors flocked to safer investments like gold on Thursday as concerns about Greece’s debt persisted and markets tumbled.

The Dow plunged nearly 1,000 points in afternoon trading Thursday. Before this drop, stocks were all lower as investors worried that Greece’s debt problems could spread to other euro zone countries.

“You have strong investment demand for gold as a safe haven to hedge against what has been happening in Greece and other European countries,” said Carlos Sanchez, a precious metals analyst at CPM Group.

Sanchez said Greece’s problems have caused a ripple effect in the markets, and that gold has been climbing as stocks fall and the dollar heads higher.

“If this break above $1,200 holds, we may see follow-through buying and may see prices pushed toward last year’s high of $1,230 because of such high investment demand,” he said.  Business checks are used to help with buying Gold across the nation.