This post was originally published on this site
Gold futures on Monday were headed higher to start the week, even as global equity markets were seeing sharp gains, with commodity experts attributing some of the buying in bullion to opportunistic investing after the metal on Friday registered its first back-to-back weekly loss since March.
“Gold prices are higher Monday morning, on some perceived bargain hunting as prices have backed down from the record high scored in early August and are trading below $2,000,” wrote Jim Wyckoff, senior analyst at Kitco.
He noted that a weaker U.S. dollar index Monday also was aiding “the precious metals market bulls.”
The U.S. dollar was off 0.4% against a half-dozen rivals, as measured by the ICE U.S. Dollar DXY, -0.33%. The buck notched a weekly gain of 0.2% last week, producing a headwind for gold buyers.
“Gold is a little higher, trading around $1,950 this morning, with the weaker dollar giving it some reprieve,” wrote Craig Erlam, senior market analyst at Oanda. “The rebound in the greenback really took the wind out of the sails of the gold recovery trade just as it was trying to break $2,000 again,” he wrote.
December gold GCZ20, +0.57% GC00, +0.57% gained $13.90, or 0.7%, to reach $1,960.80 an ounce, after marking a weekly decline of 0.1%, based on last Friday’s settlement for the most-active contract. That as sufficient a decline for the second straight weekly drop since a similar stretch ended March 20, according to FactSet data.
Meanwhile, September silver prices SIU20, +1.56% rose 55 cents, or 2.1%, to $27.255 an ounce, with the metal notching a weekly decline of 3% on Friday, based on the most active contract.
Gains for gold and silver came as Food and Drug Administration on Sunday said it authorized use of convalescent plasma, the antibody-rich blood component taken from recovered COVID-19 patients, for the treatment of serious coronavirus cases, which was giving some life to risky assets like stocks.
Precious metals have been viewed as a hedge against the uncertainty fostered by the COVID-19 pandemic and the trillions that central banks and governments have spent to limit the debilitating impact to businesses globally.
Medical experts said the treatment may provide benefits to those battling the disease, but that there isn’t conclusive evidence of its effectiveness, while questions remain about when it should be administered and dosage.
