This post was originally published on this site
Gold futures rose on Monday, finding support as global stocks declined amid fears of an escalation of tensions between the U.S. and China over the global outbreak of COVID-19.
On top of that a survey of global business activity from IHS Markit, highlighted the economic damage that has been wrought by efforts to halt the spread of the pandemic that has infected more than 3.5 million world-wide and claimed nearly 250,000 lives, according to data compiled Johns Hopkins University. April saw the sharpest fall in output and other measures of activity on record for places regions from India to Asia and the U.S. showing similar contraction.
“Steps needed to keep workers safe will mean even businesses that are able to restart production will generally be running at low capacity, and most will be operating in an environment of greatly reduced demand,” Chris Williamson, chief business economist at IHS Markit, was quoted as saying on Monday in The Wall Street Journal.
Bullion has gained some altitude as Secretary of State Mike Pompeo during a Sunday interview with ABC’s This Week, ”said he has seen ‘enormous evidence’ that the virus originated in a laboratory in Wuhan, China; and on a separate interview on Fox Business, President Donald Trump said that he believes China “made a horrible mistake and they didn’t want to admit it.”
Gold for June delivery GCM20, +1.01% rose $19.60, or 1.2%, to $1,720.50 an ounce after the yellow metal suffered a loss of about 2% last week, according to FactSet data based on the most-active contract.
The metal has been trading in a range of $1,624.40 and $1,788.80 an ounce over the past 30-day period, FactSet data show. Higher trading for bullion have been underpinned by concerns about a global recession prompted by the viral outbreak, combined with unprecedented stimulus measures enacted by monetary-policy makers to limit the economic harm from the deadly pathogen.
“The safe-haven bet, buying gold, is back in demand and the price of the shining metal is trading higher today,” wrote Naeem Aslam, chief market analyst at AvaTrade, in a Monday research note.
U.S. stocks, meanwhile, led by the Dow Jones Industrial Average DJIA, -2.55% and the S&P 500 index SPX, -2.80%, looked poised to fall, providing additional appetite for precious metals.
“Given the fact that tensions have resurfaced between the U.S. and China, investors are likely to play safe and include gold in their portfolio,” he wrote.
Meanwhile, July silver SIN20, +1.45% picked up 18 cents, or 1.2%, at $15.115 an ounce, following a weekly declined put in on Friday of 2% from the most-active contract settlement a week ago.
Elsewhere on Comex on Monday, July copper HGN20, -0.34% shed 2 cents, or 0.9%, to $2.292 a pound, after the industrial metal fell 1.1% for the week based on the most-active contract prices. July platinum PLN20, +1.48% lost $2.10, or 0.3%, to reach $771.80 an ounce, following a weekly gain of about 10 cents, and June palladium PAM20, -0.36% retreated $9.40, or 0.5%, at $1,878.40 an ounce after registering a weekly loss of 4.9% on Friday.
