Gold futures settled back above the key $1,700-an-ounce mark Friday as renewed concerns over the coronavirus pandemic and its effects on the global economy buoyed haven demand for the metal, but prices still posted a loss for the week.
“The usual uncertainty around the coronavirus and trying to understand what everyone is dealing with is prevailing once again,” said Jameel Ahmad, global head of currency strategy and market research at FXTM.
“Promising headlines that progress is being made on a vaccination for the coronavirus, alongside the gradual reopening of economies” had taken away some of the shine in gold in earlier dealings, he told MarketWatch.
However, the report from the Center for Infectious Disease Research and Policy does warn that the coronavirus pandemic is likely to last as much as two years,” he said. That would support demand for haven gold.
Gold for June delivery
GCM20,
rose $6.70, or 0.4%, to settle at $1,700.90 an ounce, after losing 1.1% a day ago. The metal, based on the most-active contracts, had put in a gain of 6.1% in April, but suffered a loss of about 2% this week, according to FactSet data.
Read:Commodities didn’t perform as badly as you may have thought in April
Also see:ETFs are holding up the gold market
Risk-off sentiment prevailed among investors Friday, with downbeat U.S. economic data and losses in the stock market contributing to a rise in gold prices. The Institute for Supply Management said its manufacturing index fell to 41.5% last month from 49.1% in March. This is the lowest since April 2009.
Meanwhile, U.S. equity markets, having come off the best monthly gains since 1987, traded sharply lower Friday as gold futures settled, with investors searching for clarity on the future in the aftermath of the COVID-19 pandemic that has infected more than 3 million people globally and claimed more than 200,000 lives globally.
Investors showed disappointment following weakness in earnings from the likes of Amazon.com Inc.
AMZN,
and Apple Inc.
AAPL,
On top of that, markets digested threats from President Donald Trump of levying tariffs or retaliating against China for its handling of the outbreak of the novel strain of coronavirus, which was first identified in Wuhan.
Meanwhile, July silver
SIN20,
lost 3.5 cents, or 0.2%, at $14.938 an ounce, following a climb of 5.8% in April, the biggest since October. For the week, prices were down over 2% from the most-active contract settlement a week ago.
Other metals moved lower, with July copper
HGN20,
down 1.4% at $2.312 a pound, with most-active contract prices down 1.1% for the week, July platinum
PLN20,
losing 4.8% to $773.90 an ounce, ending a dime higher for the week, and June palladium
PAM20,
settling at $1,887.80 an ounce, down 3.5% for the session to register a weekly loss of 4.9%.
Source : MTV
