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Gold futures were falling sharply early Tuesday, putting bullion on track for its steepest daily slide in nearly five months as global stocks were buoyed by hope of a coronavirus vaccine approval by Russia, though that approval was met with some skepticism by experts.
Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, however, has previously cast doubt on the safeness and efficacy of Russia’s vaccine candidate.
Companies including AstraZeneca PLC AZN, +0.02% and Moderna Inc. MRNA, -5.34% are presently conducting final-stage trials of their vaccines in studies that are expected to soon yield results.
Still, Russia’s President Vladimir Putin claimed that the country’s vaccine was “the first vaccine against the novel conoravirus infection in the world was registered,” during a televised government meeting.
Prices for the yellow metal have surged to records at least partly on the back of the economic damage wrought by the COVID-19 pandemic, and the potential for a vaccine has always been considered a bearish factor for the precious metal that thrives on uncertainty.
“Traders and investors have put risk back on the table today, due in part to news overnight that Russia has approved a Covid-19 vaccine,” wrote Jim Wyckoff, senior analyst at Kitco, in a Tuesday note.
He said that despite the skepticism, the “marketplace is so far Tuesday morning taking the Russian news as very good.”
The Dow Jones Industrial Average DJIA, +1.07% and the S&P 500 SPX, +0.17% were set to trade solidly higher and yields for the 10-year Treasury note TMUBMUSD10Y, 0.642% were up by about 5 basis points at 0.62%, reflecting diminished appetite for safe-haven assets like bonds and precious metals and into assets perceived as riskier like stocks.
Meanwhile, commodity investors also parsed inflation data on producer prices. U.S. producer prices jumped by an unexpected 0.6% in July, well above the 0.3% forecast from MarketWatch-polled economists. Core PPI, which strips out food and energy costs, rose 0.3%.
December gold GCZ20, -3.91% GC00, -3.91% shed $70.40, or 4.3%, to $1,952.50 an ounce, putting the precious metal on track for its steepest one-day slide since March 13, according to FactSet data, after bullion rose 0.6% on Monday.
September silver SIU20, -6.87% declined $2.28, or 7.9%, to more than wipe out its gains from a day ago and put it at around $29.261 an ounce. Silver’s decline, if it holds, would represent its sharpest daily fall since March 16.
