AGE Daily Gold Update presents a recap on today's action in the precious metals markets. View archives.
5/20/2019: Gold rises on global tensions
Source: Bill Musgrave, American Gold Exchange
Austin — Gold rose 0.1% to close above $1,277 as renewed trade-war worries and Middle East tensions pressured stocks and the dollar, buoying alternative assets.
The trade conflict between the China and the US appeared to deepen over the weekend, with both sides retrenching after failed meetings resulted in the escalation of tariffs last week. US chip manufacturers have reportedly frozen supplies of necessary hardware and software to Chinese technology giant Huawei. China has signaled it will ban exports to the US of rare-earth metals, which are crucial to a variety of technologies including electric cars and wind turbines.
US equity indexes retreated on trade-war worries. Tech shares bore the brunt, with the tech-heavy Nasdaq losing 1.5% while the S&P 500 and Dow fell 0.7% and 0.3%, respectively. Soft US data also weighed on stocks after the Chicago Fed index of national economic activity fell into contraction in April, for the second time in three months.
Rising tensions in the Middle East also weighed on risk appetite after a rocket exploded near the US embassy in Baghdad, reported fired by Iran. President Trump tweeted in response that "the official end of Iran" will occur if that nation "wants to fight."
The dollar edged 0.1% lower against major rivals, lifting gold and other commodities by making them less expensive overseas. Yields on 2-year and 10-year Treasurys fell sharply as investors shifted toward safety.
The other precious metals were mixed, with silver and palladium rising 0.4% and 1.9%, respectively, while platinum fell 0.7%.
At the Comex close: June gold rose $1.60 to $1,277.30; July silver added 6 cents, to $14.45; July platinum slid $6.10 to $814.20; and June palladium gained $25.20 to $1,331 an ounce.
AGE Gold Commentary
Gold is climbing again, reacting to falling bond yields as the cost of money has become cheaper ... read more