Gold prices climb, poised for 4% weekly gain amid public-health worries

Silver, copper futures trade higher for the week

Gold futures climbed Friday, contributing to a gain for the week, as U.S. stocks attempted to rebound from one of the worst selloffs since the COVID-19 pandemic roiled markets in March.

Prices for the precious metal had posted a gain of 1.1% a day earlier, finding support as the Dow Jones Industrial Average settled Thursday with a loss of 7% amid a resurgence of COVID-19 cases and concerns about the economic outlook.

“There is still keener risk aversion in the marketplace that will likely limit any downside pressure in the safe-haven metals,” said Jim Wyckoff, senior analyst at Kitco.com.

August gold rose $9.30, or 0.5%, at $1,749.10 an ounce on Comex, after surging 1.1% on Thursday to mark the highest settlement for a most-active contract since June 1, according to FactSet data.

For the week, the yellow metal is on pace for a weekly gain of 4% based on last Friday’s settlement of the most-active contract.

Prices were trading closer to the session’s high of $1,753, then pared some of those gains after some upbeat U.S. economic data Friday. U.S. consumer sentiment climbed to 78.9 in early June from 72.3 in May.

Providing support for haven gold, the Federal Reserve on Wednesday “basically ruled out any rate hikes for the next couple of years, while simultaneously boosted expectations that [quantitative easing] will be in operation for the foreseeable future,” said Fawad Razaqzada, market analyst at ThinkMarkets.

Safe-haven gold may also continue to “find additional support from some of the bearish factors weighing on stocks, including concerns over a second wave of infections, and raised geopolitical uncertainty,” he said in market commentary.

However, bullion investors caution that gold, which has been buoyed by government and central bank stimulus measures across the globe, may require a fresh spark to bust out of a trading range around $1,700 an ounce.

“Gold is well supported by monetary policy, but likely needs further catalysts to break higher in the very near term,” wrote UBS strategist Joni Teves, in a research report dated Thursday.

“We think market participants are likely to remain cautious about adding or building positions at this stage,” the UBS analyst wrote.

Bullion’s action on Thursday was prompted partly by evidence that the number of U.S. coronavirus infections were rising, with recent reports indicating that Arizona and Texas are showing increased cases.

Worries about the economic outlook, combined with the public-health concerns, combined to rock global risk assets on Thursday, which were staging a modest comeback on Friday. U.S. benchmark stock indexes traded higher in Friday dealings.

Among other metals Wednesday, July silver shed 2.4 cents, or 0.2%, at $17.86 an ounce, with the metal on pace for a 2% weekly gain.

July copper tacked on 1.3% to $2.62 a pound, trading around 2.5% higher for the week. July platinum rose 2.3% to $842.50 an ounce, on track for a weekly rise of more than 1%, while September palladium added 2.1% to $1,950.60 an ounce, with prices down about 0.1% for the week.

June 12, 2020 at 10:25 a.m. ET By Myra P. Saefong and Mark DeCambre – MarketWatch

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