1 hr ago – 12.27PM Gold stocks plunge, Newmont down 3pc
Nicola Blackburn
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Gold stocks were a sea of red on Tuesday after a trade deal struck between the US and China sparked a fresh wave of selling.
The decision on Monday by Washington and Beijing to substantially lower tariffs on each nation’s imports, easing a months-long trade war, has sparked a risk-on rally in equity markets.
Gold prices dropped almost 3 per cent on Monday as investors dumped haven assets.
Spiralling prices drove a steep sell-off in ASX-listed gold stocks.
Capricorn Metals led the losses on Tuesday, dropping 11.5 per cent, followed by Genesis Minerals, down 10 per cent. Newmont, one of the world’s largest gold miners, dropped 3.1 per cent.
At 12.23pm, the 13 worst-performing stocks on the ASX 200 were gold miners.
1 hr ago – 11.45AM Gold steadies after Monday’s heavy loss
Bloomberg
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Gold steadied after a sharp selloff as a major de-escalation in US-China trade tensions hurt demand for havens.
Bullion traded near $US3237 an ounce – after losing 2.7 per cent on Monday – with investors betting on a recovery in stocks and riskier assets. The world’s biggest economies agreed to temporarily lower tariffs, with the US slashing duties on Chinese products to 30 per cent from 145 per cent for a 90-day period, while Beijing dropped its levy on most US goods to 10 per cent.
The US dollar rose the most since a post-election rally in November, while Treasury yields climbed – both acting as headwinds for gold. Traders now see just two rate cuts from the US Federal Reserve in 2025 in a reset of inflation expectations. That reduces bullion’s appeal as the metal pays no interest.
Spot gold was steady at $US3237.86 an ounce at 7.38am in Singapore (9.38am AEST).
….Gold traders brace for the US CPI inflation data on Tuesday, which might offer some hints about the US Federal Reserve's (Fed) policy path. The headline CPI is expected to show an increase of 2.4% YoY in April, while the core CPI is projected to show a rise of 2.8% YoY in the same report period.
Swap markets have priced in the Fed’s first 25 basis points (bps) rate cut for the September meeting, and they expect two additional rate reductions towards the end of the year. Last week, they indicated three cuts this year, with a change likely as soon as July.
India’s Prime Minister Narendra Modi said on Monday that operations against Pakistan have only been kept in abeyance, and the future will depend on their behaviour. Meanwhile, Ukrainian President Volodymyr Zelensky noted he is prepared to meet Russian President Vladimir Putin this week, shortly after Trump urged him to “immediately” accept the Russian leader’s offer to hold peace talks in Turkey. Any signs of escalating geopolitical tensions could boost the safe-haven flows, benefiting the yellow metal. Gold price retains positive bias in the longer term
Gold price trades on a negative note on the day. According to the daily timeframe, the constructive outlook of the precious metal remains intact, characterized by the price holding above the key 100-day Exponential Moving Average. However, further consolidation ot temporary sell-off cannot be ruled out as the 14-day Relative Strength Index (RSI) is located below the midline.
On the bright side, the first upside barrier to watch is $3,347, the high of May 9. Any follow-through buying above this level could pave the way to $3,432, the upper boundary of the Bollinger Band. Further north, the next hurdle is seen at the all-time high of $3,500.
In the bearish case, the $3,200 psychological level acts as an initial support level for XAU/USD. The additional downside filter emerges at $3,142, the high of April 2.
SPR Price at posting:
$1.90 Sentiment: Hold Disclosure: Held
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