(Bloomberg) — Gold headed for back-to-back gains as investors weighed the outlook for the metal’s record-setting rally after this week’s dramatic price swings.
Rising U.S. bond yields helped spark a sharp selloff in gold Tuesday and early Wednesday, followed by a rebound later in the day. Both gold and silver have resumed their uptrend after the correction and remain among the best-performing commodities this year, aided by negative real yields and vast stimulus to combat the fallout from the coronavirus pandemic.
“We still hold a positive view on gold, targeting a retest of the level of $2,000 an ounce by the end of this year,” said Giovanni Staunovo, an analyst at UBS Group AG. “The Fed should reiterate its dovish message and U.S. real yields and the broad U.S. dollar will likely fall further in our view.”
Spot gold rose 1.1% to $1,936.45 an ounce by 12: 15 p.m. in London. On Tuesday, prices dropped 5.7%, the biggest one-day loss in seven years, following a rally to an all-time high last week. Futures for December delivery were little changed on the Comex in New York.
Silver for immediate delivery rose 3.8% to $26.477 an ounce, after a 2.9% gain on Wednesday and a 15% slump on Tuesday. The Bloomberg Dollar Spot Index dropped for a second day, while European stocks and U.S. futures slipped as a global rally of equities showed signs of fatigue.
Read More: Gold Consumers in India Hug Sidelines Ignoring Steep Price Drop
Investors were also weighing a heightening of trade tensions between the U.S. and European Union, centered on a long-running dispute over illegal subsidies to Airbus SE. The Trump administration reordered its tariffs to better target French and German products, with the total subject to the levies remaining at $7.5 billion.
The death toll from the virus continued to climb, with India’s total surpassing the U.K.’s, according to the latest data collated by Johns Hopkins University. There were signs of resilience to the economic harm wrought by the pandemic though. Australia added four times as many jobs as forecast in July, withstanding a fresh lockdown in Victoria and concerns about infection spreading.
bloomberg.com” data-reactid=”35″ type=”text”>For more articles like this, please visit us at bloomberg.com
Subscribe now to stay ahead with the most trusted business news source.” data-reactid=”36″ type=”text”>Subscribe now to stay ahead with the most trusted business news source.
©2020 Bloomberg L.P.
Content retrieved from
Yahoo Finance RSS feed.