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Anonymous ID: 9d913c March 2, 2020, 11:58 a.m. No.8301050   🗄️.is đź”—kun   >>1058

Gold ends sharply higher after biggest daily drop in nearly 7 years

 

Gold futures rebounded on Monday, tacking on nearly 2% after suffering the sharpest drop since 2013 in the previous session, finding support as central banks promise to act appropriately to mitigate the effect of a viral outbreak that is expected to hurt global economies and supply chains.

 

Bank of Japan Gov. Haruhiko Kuroda said the central bank would take steps to steady markets, and bolster liquidity through short-term lending operations and asset purchases. On Friday, Federal Reserve Chairman Jerome Powell issued a rare, unscheduled statement, emphasizing the central bank’s intention to act appropriately to address the risks posed by the coronavirus.

 

A second death from the virus in the U.S., has raised fears of a wider spread of the disease domestically and investors are starting to believe that the Fed and other central banks will act to tamp down expected economic shocks from COVID-19, the infectious disease that originated in Wuhan, China late last year and has rapidly spread across the globe.

 

The global death toll from the illness stands at more than 3,000, and deaths in China stand at 2,900, according to recent reports. There are fewer margin calls in the stock market Monday and growing expectations of Fed moves as markets are signaling rate cuts, said George Gero, managing director at RBC Wealth Management, in a note.

 

Expectations for a Fed interest rate cut at the March 18 meeting are rising “and gold’s appeal as a safe haven is still strong” as the likelihood of “further coronavirus problems and upcoming political headlines in the U.S., Israel, South America, Greece, eurozone and Middle East worries are still intact.” In Monday dealings, gold for April delivery GCJ20, +1.97% on Comex rose $28.10, or 1.8%, to settle at $1,594.80 an ounce. It fell nearly 5% on Friday—the biggest one-day percentage loss since the week ended June 20, 2013. The metal last week also booked a weekly slide of about 5%. Still, gold is up more than 4% so far this year, according to FactSet data, based on the most-active contracts.

 

May silver SIK20, +1.99%, meanwhile, rose 28.2 cents, or 1.7%, to $16.739 an ounce, after registering a more than 7% drop on Friday, which contributed to a weekly skid of about 11.6%. The white metal marked its sharpest weekly slide since the period ended April 19, 2013. Silver is down around 7% so far this year.

 

Providing an added boost to haven demand for the precious metals, the Institute for Supply Management said its U.S. manufacturing index dipped to 50.1% last month from 50.9% as most U.S. manufacturers said business began to slow to a crawl. Among other metals, May copper HGK20, +2.32% added 2.2% to $2.595 a pound, April platinum PLJ20, -0.38% fell by 0.6% to $859.40 an ounce and June palladium PAM20, -2.79% shed nearly 2.6% to $2,427.70 an ounce.

https://www.marketwatch.com/story/gold-bounces-sharply-higher-after-biggest-daily-drop-in-nearly-7-years-2020-03-02