Gold prices drop over 1%, heading for sharpest weekly skid in over a year
New York (Oct 11) Gold futures headed lower Friday, putting bullion on track to record its steepest weekly drop in more than a year and lowest settlement month to date, amid growing optimism on Sino-American trade talks and progress on Brexit.
December gold on Comex GCZ19, -1.11% was down $20.10, or 1.3%, to trade at $1,480.80 an ounce, falling further below the psychologically significant level at $1,500. Bullion’s decline, if it holds, would push the most-active gold futures contract to its lowest settlement and sharpest daily slump since Sept. 30, according to FactSet data.
For the week, gold is on track to lose 2.1%, which would represent the biggest weekly percentage decline for the most-active contract since a 2.85% decline in the week ended Aug. 17, 2018.
Meanwhile, December silver SIZ19, -0.49% lost 17.2 cents, or 1%, to trade at $17.43 an ounce, putting gold’s sister metal on pace for a weekly decline of 1.1%.
Markets were buoyant, after President Donald Trump offered an upbeat assessment of the talks and said he would meet with China Vice Premier Liu He on Friday, the final day of the most recent round of high-level trade discussions.
“Gold just needs to withstand the market relief that comes from a mini-trade deal,” said Edward Moya, senior market analyst at Oanda.
“Poised for a weekly decline, gold prices should regain footing next week as investors probably scrutinized the band-aid trade solution,” he said in a daily note. “Gold should be supported on global stimulus bets and skepticism a broader trade deal won’t be reached until after the election.”
Still, for now, optimism around a possible resolution has given a lift to stocks, while undercutting appetite for assets perceived as havens like gold and government bonds. The Dow Jones DJIA, +1.84% and the S&P 500 index SPX, +1.84% both climbed in Friday action.
Benchmark U.S. stock indexes also got a boost after preliminary data released from the University of Michigan on Friday also revealed that the consumer sentiment survey rose to a three-month high of 96 this month from 93.2 in September.
Meanwhile, growing hopes that U.K. and European leaders can reach a deal for Britain to leave the European Union also pushed equity markets higher and precious metals’ prices lower
In other metals dealings, December copper HGZ19, +0.31% added 0.3% to $2.6215 a pound, looking at a weekly rise of 2.3%. January platinum PLF20, -1.53% shed 1.9% to $890.90 an ounce, paring its weekly rise to around 0.4%. December palladium PAZ19, -0.42% traded at $1,669.50 an ounce, down 0.4% in Friday trading, though still poised for a weekly climb of 1.7% after settling at a record high Thursday.
MarketWatch
