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Gold Lower As Safe Haven Flows Dry Up

Gold is solidly lower in early U.S. trading Wednesday, pressured by rallies in most major world stock markets today that have pulled investor interest away from the safe-haven metal. An upbeat U.S. durable goods orders report Wednesday morning also put more selling pressure on gold. However, there is an entire U.S. trading session that lies ahead, and no one knows what the end of the day will bring. A weakening in the U.S. stock market as today’s session progresses would likely boost the gold market. December Comex gold was last down $13.30 at $1,125.10 an ounce. September Comex silver hit a six-year low this morning and was last down $0.465 at $14.14 an ounce.

The eyes of the market place remain focused on China, which has the world’s second-largest economy, which is now in trouble. China’s central bank injected $22 billion into its financial system Wednesday after their markets closed, in order to prop up its flailing stock market. Government officials also restricted trading in stock index futures, reports said. After a volatile session that saw prices trade on both sides of unchanged, China’s Shanghai stock index ended down 1.3% on the day. However, Japan’s Nikkei stock index rebounded and rose 3% on Wednesday.

via Kitco [1]

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Alfonso Esparza

Alfonso Esparza [6]

Senior Currency Analyst at Market Pulse [7]
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza