News Column

Gold Ends Higher On Iraq Concerns

June 23, 2014



WASHINGTON (Alliance News) - Gold futures moved up to end higher for a fourth straight session on Monday, with investors keeping a close watch on the developments in Iraq with Secretary of State John Kerry in Baghdad for talks with political and religious leaders to tackle the ISIS threat. Gold also remained subdued after some upbeat manufacturing activity data from the US and China, and the dollar trending lower.

Worries over the escalating situation in Iraq where militants have reportedly seized more cities in the northern part of the country provided an impetus for the precious metal to move up.

Meanwhile, reports indicate US Secretary of State John Kerry has had discussions with Iraqi Prime Minister Nouri al-Maliki as well as top Shia and Kurdish leaders to find ways to stop the onslaught from the ISIS al Qaeda-linked militants. Kerry is reported have stressed the need to form a unity government quickly involving all concerned, including Shias, Sunnis, and Kurds. It is also reported that al-Maliki has promised to initiate proceedings towards forming a unity government involving diverse communities beginning July.

In some upbeat economic news, Chinese manufacturing sector expanded for the first time in six months in June driven by domestic and foreign orders, even as the US purchasing managers index rose to its best in over 4 years. As well, existing home sales in the US increased much more than expected in May

Gold for August delivery, the most actively traded contract, gained USD1.80 or 0.1% to close at USD1,318.40 an ounce on the Comex division of the New York Mercantile Exchange on Monday.

Gold for August delivery scaled an intraday high of USD1,319.20 and a low of USD1,310.40 an ounce.

On Friday, gold futures ended higher, extending gains to a third successive session, and gaining 3.3% for the week. The Federal Reserve's pledge to hold rates at a record low for an extended period of time and the ongoing violence in Iraq contributed to gold's gain.

Holdings of SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, remained unchanged at 782.62 tons on Monday from its previous close.

The dollar index, which tracks the US unit against six major currencies, traded at 80.29 on Monday, down from its previous close of 80.33 late Friday in North American trade. The dollar scaled a high of 80.40 intraday and a low of 80.24.

The euro traded higher against the dollar at USD1.3603 on Monday, as compared to its previous close of USD1.3590 late Friday in North American trade. The euro scaled a high of USD1.3613 intraday and a low of USD1.3574.

On the economic front, data from the National Association of Realtors showed US existing home sales to have increased by a more than expected 4.9% to a seasonally adjusted 4.89 million in May, from an upwardly revised 4.66 million in April. The consensus estimate called for existing home sales to come in at a seasonally adjusted annual rate of 4.75 million units compared to a 4.65 million unit-annual rate in April.

Meanwhile, the Markit Economics flash manufacturing purchasing managers index for the US came in with a reading of 57.5 for June, the best in over 4 years and up from a reading of 56.4 in May. Economists expected the index to rise to 56.5 in June.

In economic news from Asia, Markit said that Chinese manufacturing sector expanded for the first time in six months in June, with the HSBC flash manufacturing Purchasing Managers' Index rising to 50.8, from 49.4 in the previous month.

Meanwhile, eurozone private sector growth slowed for a second month running in June as downturn deepened in France. The headline index covering output of both manufacturing and services fell below forecast to 52.8 from 53.5 in May, flash survey data from Markit Economics showed.



For more stories on investments and markets, please see HispanicBusiness' Finance Channel



Source: Alliance News


Story Tools






HispanicBusiness.com Facebook Linkedin Twitter RSS Feed Email Alerts & Newsletters