Gold steady following Manchester blast; US political woes support
Gold was steady on Tuesday with investors staying on the sidelines following an explosion in the English city of Manchester that left at least 19 people dead and over 50 injured.
The explosion occurred at the end of a concert by US singer Ariana Grande on Monday, in what two US officials said was a suspected suicide bombing.
Prime Minister Theresa May said the incident was being treated as a terrorist attack.
“Right now, precious metals prices are relatively quiet, this despite tragic news coming out of Manchester, England,” said INTL FCStone analyst Edward Meir.
“We suspect that gold will respond more forcefully going into Tuesday’s session as geopolitical tensions start to rise again.
”Spot gold was up 0.1 percent at $1,261.55 per ounce as of 0339 GMT. US gold futures rose 0.1 percent to $1,262.20 an ounce. The metal has been supported by the political tensions in the United States due to the ongoing controversies involving President Donald Trump, and the dollar’s weakness against the euro. “The weaker dollar is helping gold Chopping off of some long positions has made the market healthier,” said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong.
Spot gold advanced by 2.2 percent last week as the furore over Trump’s alleged links to Russia and his firing of former Federal Bureau of Investigation chief James Comey raised concerns about his ability to push through promised fiscal stimulus. The euro hovered near a six-month high against the dollar on Tuesday after German Chancellor Angela Merkel said the currency was “too weak”.
Spot gold may gain further to $1,272 per ounce, following its break above a resistance at $1,257, according to Reuters technical analyst Wang Tao.
“Nervousness ahead of Thursday’s OPEC meeting should see traders continue to hedge risk by buying gold on dips over the next few days,” said Jeffrey Halley, a senior market analyst at OANDA. Among other precious metals, silver was close to a three-week peak touched on Monday, when it rose 1.8 percent in its biggest one-day percentage rise since April 11. The white metal was flat at $17.12 an ounce. Platinum was up 0.2 per cent at $948 an ounce, hovering near its highest in more than three weeks hit on Monday.
Palladium was nearly unchanged at $770.22 per ounce. It fell to a more than two-month low in intraday trading on Monday but recovered to end the day 1.5 percent higher, its biggest one-day percentage gain since April 20.