Gold prices up; G-7 offers no specifics to combat coronavirus
London (Mar 3) Gold and silver prices are higher in early U.S. futures trading Tuesday, on a further corrective bounce following sharp losses posted late last week. The safe-haven metals are also getting a bid after the Group of Seven finance ministers released a statement just a short while ago that offered no specifics on dealing with the coronavirus outbreak. That knocked the U.S. stock indexes down from their overnight highs. There is still risk aversion in the marketplace. April gold futures were last up $9.00 an ounce at $1,604.00. March Comex silver prices were last up $0.091 at $16.83 an ounce.
The G-7 statement, following a scheduled teleconference held, said central bankers “stand ready to cooperate further” to address the coronavirus outbreak. Some market watchers were hoping the statement would provide more details on stimulating monetary policies to thwart the economic impact of the outbreak.
Global stock markets were mixed to firmer overnight, following the strong rebound in the U.S. stock market Monday. While the Covid-19, or coronavirus, outbreak appears to have slowed its rate of spread in China, the illness rate is growing outside of China, including South Korea, Italy and other countries. The marketplace is becoming more focused on what the major economies of the world are doing to prevent economic damage. Australia’s central bank cut its main interest rate overnight. President Trump again brow-beat the Federal Reserve in a tweet overnight, urging the U.S. central bank to lower interest rates. Many analysts are now saying the outbreak’s impact on global economies will be serious but the duration of the impact will be short. U.S. stock indexes are pointed toward lower openings when the New York day session begins.
Many are wondering if Monday’s big gains in the U.S. stock indexes point to market bottoms being in place. Maybe. A more solid clue that near-term market bottoms are in place in the stock indexes (or any other market that has been beaten down the past few weeks) would be two very strong up-days in a row, or a bullish weekly high close on a Friday. Also, it’s very likely that higher market volatility will resurface, and probably soon. The Covid-19 outbreak has moved on and off the front burner of the marketplace many times over the past couple months, and such will likely continue for the near term.
The yield on the benchmark U.S. Treasury 10-year note rose to 1.150% Tuesday after hitting a record low of 1.031% Monday. Gold and silver prices are higher early Tuesday, following good gains Monday.
The key outside markets today see Nymex crude oil prices higher and trading around $48.35 a barrel in early trading. The U.S. dollar index is trading up today following recent strong selling pressure.
U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the ISM New York report on business, the IBD/TIPP economic optimism index, and domestic auto sales.
KitcoNews
