Gold edges up as virus worries eclipse vaccine optimism
· Gold prices edged higher on Thursday, after dropping over 1% in the previous session, as concerns over the economic fallout from surging Covid-19 cases outweighed positive vaccine news.
· Spot gold rose 0.3% to $1,869.51 per ounce by 0339 GMT.
· U.S. gold futures were 0.03% higher at $1,873.80.
· “Gold traders are trying to strike a balance between a positive vaccine news versus a rising number of coronavirus cases around the globe,” said Margaret Yang, a strategist with DailyFx, which covers currency, commodity and index trading.
Although the vaccine may affect the medium- to long-term trend of gold prices, monetary and fiscal stimulus are needed in the near-term to shelter the global economy, Yang said.
· European Central Bank President Christine Lagarde signaled further support for the economy on Wednesday as the pandemic intensified in Europe, with cases expected to spike in winter.
· Gold tends to benefit from widespread stimulus measures from central banks because it is considered a hedge against inflation and currency debasement.
· Risk appetite has been boosted by hopes of a successful vaccine, but analysts say it may take a long time before one becomes publicly available.
· Gold prices have come under pressure after Monday’s encouraging late-stage coronavirus vaccine trial data by Pfizer Inc and BioNTech. Prices are down 4.2% so far for the week.
· “The reality is we are just holding above the support levels between $1,850 and $1,860 and a breach there would introduce some pretty serious downside potential,” said Michael McCarthy, chief strategist at CMC Markets.
· The dollar index held steady near a one-week high hit on Wednesday.
· Silver fell 0.1% to $24.23 per ounce. Platinum rose 0.1% to $866.25, while palladium was up 0.8% at $2,333.53.
· CORONAVIRUS UPDATES:
Global Cases: 53.03M (+607,821)
Global Deaths: 1.298M (+9,261)
U.S. Cases: 10.84M (+139,262)
U.S. Deaths: 248,412 (+1,014)
· U.S. cases continue their rapid rise; Chicago issues stay-at-home advisory ahead of Thanksgiving
· California becomes second U.S. state to surpass 1 million Covid cases
· Dr. Fauci says ‘help is on the way’ with vaccines, but doubts Covid can ever be eradicated
· Dr. Scott Gottlieb: ‘Covid cases in the U.S. should peak in January’
The next two to three months will be difficult for Americans as the coronavirus sweeps the nation and the second surge of the virus picks up steam, says Dr. Scott Gottlieb, the former commissioner of the FDA and a CNBC contributor speaking at CNBC’s first Workforce Executive Council Summit on Thursday. As he points out, even as drug manufacturers make progress on a vaccine and treatments, epidemiologists, scientists and public health officials are warning that the United States has yet to see the most difficult days of the outbreak.
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· “We are three to four weeks behind Europe now and we are headed in the same direction in terms of the progression of the disease,” he said. “We are not moving fast enough to change our behaviors, reduce mobility and take policy actions to stop the trend.”
· Crucial Moderna vaccine data is coming soon
Moderna is expected to release key data in the coming days from a trial that will show whether its vaccine is effective against the coronavirus.
Investors anticipate the vaccine will be highly effective, especially after Pfizer, another frontrunner in the Covid-19 vaccine, announced that its vaccine was 90% effective, said Brad Loncar, a biotech investor. Moderna’s product, like Pfizer, is using messenger RNA, or mRNA, technology.
While Moderna may announce the vaccine’s overall effectiveness, the public will likely still have to wait for other key details, like how effective the vaccine is in the elderly or people with preexisting conditions, said Paul Offit, director of the Vaccine Education Center at Children’s Hospital of Philadelphia.
Safety data will also be crucial, he said. The Food and Drug Administration is requiring that drugmakers provide at least two months of safety data after vaccinating volunteers before asking for emergency use authorization.
· Pelosi and McConnell are split on coronavirusaid as infections hit new records
· U.S. starts fiscal 2021 with 111% jump in October deficit
The U.S. government started fiscal 2021 with an October budget deficit of $284 billion, a record for the month, as coronavirus-related outlays spiked sharply from a year earlier and revenues declined, the Treasury Department said on Thursday.
· Republicans urge Trump to allow Biden briefings as U.S. election challenges sputter
· U.S. judge dismisses Trump campaign libel lawsuit against CNN
· Pennsylvania officials ask judge to toss Trump lawsuit over election results
· Trump's final Fed picks may get Senate nod next week
President Donald Trump looks set to put his final stamp on the Federal Reserve just weeks after being voted out of office, with the Senate expected to approve his picks soon to fill the last two open seats at the U.S. central bank.
· Trump bans investments in companies that White House says aid China’s military
President Donald Trump on Thursday signed an executive order barring Americans from investing in a a collection of Chinese companies that the White House believes support Beijing’s military.
The order prohibits American companies and individuals from owning shares outright — or through investment funds — in companies the administration deems to help enhance the People’s Liberation Army.
The ban will take effect starting 9:30 a.m. on Jan. 11, 2021 and targets 31 companies identified by Department of Defense as “Communist Chinese military compan[ies].”
The list of firms includes large state-run aerospace and construction companies, as well technology and communications companies like Inspur Group, Huawei and China Telecommunications Corp.
National Economic Council Director Larry Kudlow and national security advisor Robert O’Brien have led the administration’s calls for a crackdown on U.S. investment in Chinese companies.
“The President’s action serves to protect American investors from unintentionally providing capital that goes to enhancing the capabilities of the People’s Liberation Army and People’s Republic of China intelligence services,” O’Brien said in a statement on Thursday.
· Euro zone industry output unexpectedly slips in Sept
Euro zone industrial production unexpectedly declined in September, driven chiefly by a sharp fall in the output of durable consumer goods, sounding a negative note to a quarter that had begun strongly.
The European Union’s statistics office Eurostat said on Thursday that industrial production in the 19 countries sharing the euro fell 0.4% month-on-month in September for a 6.8% year-on-year decline.
That compared with the average expectations in a Reuters poll of economists of respectively a 0.7% increase and a drop of 5.8%.
It also marked the fourth consecutive month of declining production growth from 12.5% in May to 5.3% in July, 0.6% in August and now a slip in September.
Output of durable consumer goods, such as televisions and washing machines, has been the strongest component of the previous months’ growth, but fell back 5.3% in September. Energy production was also down, by 1.0% in the month.
All other components rose, notably of non-durable consumer goods, such as clothes, by 2.1%.
· EU must show flexibility, especially over Northern Ireland, UK's Gove says
The European Union must show flexibility to help secure a free trade deal with Britain, particularly in Northern Ireland where the easy movement of goods must be maintained with the rest of the United Kingdom, Brexit supremo Michael Gove said.
· Shots fired at Saudi embassy in The Hague, police arrest suspect
· Global stock market value rises to a record $95 trillion this week on vaccine hope
Reference: CNBC, Reuters, Worldometers
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