Spot Gold Advances, Trimming Weekly Loss, as Dollar Declines
Gold Trims Weekly Decline as Rising Virus Cases, Vaccine Weighed
(Bloomberg) -- Gold rose on renewed weakness in the dollar, which fell as appetite for U.S. equities recovered.
The Bloomberg Dollar Spot Index declined as much as 0.4%, paring a weekly advance. U.S. stocks climbed as better-than-estimated results from some big companies tempered concern over a surge in coronavirus cases.
“It’s a mean-reversion Friday: The dollar giving up some of its weekly gains has helped amplify the impact fresh of gold buying,” said Tai Wong, head of metal derivatives trading at BMO Capital Markets.
Spot gold gained 0.5% to $1,885.48 an ounce at 1:55 p.m. New York time. Bullion futures for December delivery rose 0.7% to settle at $1,886.20 an ounce on the Comex in New York.
This week, the spot metal is down 3.4%, heading for the biggest drop since late September. Gold ETF holdings declined to 3,436.4 tons as of Thursday, the lowest in six weeks, according to an initial tally by Bloomberg.
Investors have sold almost 18 tons from ETFs this week after Pfizer Inc.’s announcement of progress on a virus vaccine sparked optimism for a turning point in the fight against the pandemic.
“Investors are getting nervous holding long gold positions because every rally runs into a brick wall,” said Georgette Boele, precious metal analyst at ABN Amro Bank NV. “I think there is more to come in the near term.”
New York Mayor Bill de Blasio warned parents to prepare for city schools to halt in-person classes as soon as Monday. California, Oregon and Washington state urged arriving people to self-quarantine as hospitals across the region are “stretched to capacity.”
Spot silver climbed 1.7%. Platinum advanced, and palladium dropped.
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