Gold gains as dollar dips in run-up to U.S. election verdict
· Gold rose on Tuesday as the dollar slipped and ambiguity regarding the declaration of U.S. presidential results prompted investors to seek the refuge of the safe-haven metal.
· Spot gold rose 0.7% to $1,907.96 per ounce. U.S. gold futures settled up 0.9% at $1,910.40.
· “The sole driver behind gold prices is the high likelihood that there is going to be chaos surrounding the U.S. elections, from the predictions of not having a president by tonight,” said Jeffrey Sica, founder of Circle Squared Alternative Investments.
“We’re going to break above $2,000 an ounce levels with a potential of an all-time high by the (presidential) inauguration (on Jan. 20),” Sica said, adding that gold is going to have significant momentum until the next president is decided and then it will depend on further stimulus.
· Despite Democrat Joe Biden’s consistent lead in national polls, the contest is close in swing states, and it may be days before the result is known due to delays in ballot counting.
· Bullion also received support from a falling dollar, as investors bet on victory by Biden, who could potentially inject a larger stimulus into the virus-hit economy.
· The pandemic continued to rage with several European countries under fresh lockdowns.
· “The election result, when we get it, is likely to be gold-friendly with a likely weakening dollar, fresh stimulus, rates in negative territory and a likelihood that the Fed will start buying longer term assets,” StoneX analyst Rhona O’Connell said in a note.
· The Federal Open Market Committee will begin its two-day meeting on Wednesday.
· Gold prices had climbed to an all-time high of $2,072.50 an ounce in August, but have since come down on reduced holdings by gold Exchange Traded Funds (ETF).
· Silver rose 0.7% to $24.20 per ounce. Platinum rose 1.3% to $869.87 and palladium gained 3.4% at $2,287.03.
· Democrats favored to take control of U.S. Senate, but results could be delayed
Democrats are favored to emerge from 14 hotly contested U.S. Senate races with full control of Congress in Tuesday’s election, but final results from at least five of those contests may not be available for days, and in some cases, months.
With public disapproval of President Donald Trump weighing on Republicans across the country, voters will decide whether to end the political careers of embattled Republican senators including Trump ally Lindsey Graham of South Carolina and moderate Susan Collins of Maine among others.
· Thomson Reuters reports higher quarterly revenue, raises cash flow outlook
Thomson Reuters Corp TRI.TOTRI.N reported higher revenue for the third quarter on Tuesday and raised its full-year free cash flow outlook for 2020.
The news and information provider, which owns Reuters News, said quarterly revenue rose 2% to $1.44 billion and operating profit rose 21% to $318 million.
· Brexit talks fail to agree on fisheries, two other issues
EU-UK trade negotiations have so far failed to reach agreement on their three most persistent sticking points - the level playing field, fisheries and settling disputes - the bloc’s executive and sources from both sides said on Tuesday.
That comes after nearly two weeks of intensified talks to salvage free trade between the 27-nation European Union and Britain from 2021. The negotiations are in a final stretch aimed at sealing a new trade agreement by Nov. 15.
Reference: CNBC, Reuters
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