Performance papers
Markets

Gold ticks down, as global stocks soar amid easing Brexit concerns

Investing.com -

Investing.com -- Gold ticked down on Monday amid easing Brexit concerns, as a surge in global equities and crude futures weighed heavily on the safe-haven asset.

On the Comex division of the New York Mercantile Exchange, Gold for August delivery traded between $1,280.50 and $1,295.25 an ounce before settling at $1,290.35, down $4.35 or 0.34% on the day. Since hitting 22-month highs late last week, Gold has fallen slightly in each of the last three sessions. The precious metal has soared approximately 20% over the first six months of the year and is on pace for one of its strongest first halves in more than a decade.

Gold likely gained support at $1,125.00, the low from February 3 and was met with resistance at $1,316.40, the high from June 16.

In the euro area, major stock indices soared on Monday as the "Remain" campaign ratcheted up support over the weekend ahead of a controversial referendum later this week. Last week, officials on both sides suspended campaigning for two consecutive days following the tragic murder of Labour Party parliament member Jo Cox. In the U.K., the FTSE 100 surged 3% to 6,204.00, while the broader Euro Stoxx 600 Index jumped 3.65% to 337.67. The rally among euro area stock spilled over onto Wall Street, where the Dow Jones Industrial Average rose by as much as 250 points.

Metal traders await a two-day appearance by Federal Reserve chair Janet Yellen on Capitol Hill for further indications on potential delays from the U.S. central bank on the timing of its next interest rate hike. Last Wednesday, the Federal Open Market Committee (FOMC) voted unanimously to hold interest rates steady amid slowing labor market conditions over the previous two months. The market responded by downgrading the odds of monetary policy tightening through December.

On Friday, Federal Reserve of St. Louis president James Bullard shifted his hawkish positioning by suggesting that the FOMC may only need to lift short-term rates once over the next two-and-a-half years given the current low interest global backdrop. Investors who are bullish on Gold are in favor of a gradual tightening of monetary policy by the Fed. Gold, which is not attached to interest rates, struggles to compete with high-yield bearing assets in rising rate environments.

Elsewhere, investors kept a close eye on currency fluctuations in the Indian rupee after Raghuram Rajan, the head of the India Central Bank announced over the weekend that he will not be seeking another term. USD/INR stood at 67.5525 in U.S. afternoon trading, up 0.72% on the session. On Monday, India approved sweeping reforms, which could pave the way for Apple Inc (NASDAQ:AAPL) and other top companies to begin opening stores throughout the nation. India is the world's largest consumer of gold.

The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, fell more than 0.65% to an intraday low of 93.55, its lowest level in a week. The index is down by more than 5% since early-December. Dollar-denominated commodities such as gold become more expensive for foreign purchasers when the dollar appreciates.

Silver for July delivery rose 0.109 or 0.63% to $17.520 an ounce.

Copper for July delivery jumped 0.042 or 2.05% to $2.093 a pound.

Investing.com offers an extensive set of professional tools for the financial markets.

Read more News on Investing.com and download the new Investing.com apps for Android and iOS! http://glocdn.investing.com/news/gold3_M_1440050153.jpg

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

ForEx