Gold managed to close tad higher on Friday, with heightened tension pegged to North Korea boosting the metal’s appeal as an investment haven,
GOLD : – Gold managed to close tad higher on Friday, with heightened tension pegged to North Korea boosting the metal’s appeal as an investment haven, but prices still recorded the second weekly decline in a row after the Federal Reserve hinted at an interest-rate hike before year-end. December gold added 0.4%, to $1,299.30 an ounce, a day after posting the lowest close since Aug. 24 and slipping beneath the psychologically significant level of $1,300 for the first time in September. For the week, prices traded about 2% lower, which would mark its worst weekly fallsince the period ended July 7. The exchange-traded SPDR Gold Shares ETF GLD, +0.29% rose 0.5%, but traded 1.8% for the week. Late Thursday,North Korean officials threatened to test a hydrogen bomb over the Pacific Ocean, escalating tensions in the Korean Peninsula.
North Korea’s leader Kim Jong Un criticized President Donald Trump for remarks made during the U.S. leaders U.N. speech Tuesday, in which he threatened to “totally destroy” Pyongyang if provoked. The central bank also announced that a plan to unwind its more than $4 trillion balance sheet would commence in October. Both policy measures can have the effect of tightening monetary policy and raise rates. Higher rates in turn can make gold, which doesn’t bear a yield, less attractive compared with assets with rising yields.
CRUDE OIL :- Oil prices were mixed on Friday, hovering close to their highest levels in months, as major producers may wait until January before deciding whether to extend their output curbs beyond the first quarter. Russia’s energy minister said no decision was expected before January, although other ministers suggested such a decision could be taken before the end of this year. International benchmark Brent crude futures rose 28 cents to $56.71 a barrel. The contract earlier hit $56.87, the highest intraday level since March 1. U.S. West Texas Intermediate (WTI) crude futures were down 3 cents at $50.52 per barrel, not far from a nearly four-month intraday high of $50.81 struck in the previous session. Prices were little changed after Baker Hughes reported that oil rigs operating in U.S. fields fell by 5 to a total of 744. Oil prices have gained more than 15 percent in the last three months, suggesting output cuts of 1.8 million barrels per day by OPEC and other producers have helped clear the global crude glut. Rising global demand has also brought more balance to the market. Kuwaiti Oil Minister Essam al-Marzouq, who chaired the meeting in Vienna,
said the market “is evidently well on its way towards rebalancing.
COPPER : – Copper at LME fell on Friday as investors slashed risk given escalating tensions on the Korean peninsula and ongoing jitters about China debt after a ratings downgrade. However prices recovered a bit later in the session as investor winded up their position ahead of the weak end. A combination of factors had led to the sell-off, among them, rising geo-political tension with North Korea, expectations for a more aggressive interest rate rise cycle in the United States and to a smaller extent ongoing credit concerns in China.
In Shanghai, metals fell, with the steepest tumble in nickel, which will also face higher trading fees on the Shanghai Futures Exchange (ShFE) from Friday. Investors had surged into metals on prospects of resilient China demand and environmental curbs that have cut into supply. S&P Global Ratings downgraded China’s long-term sovereign credit rating on Thursday, less than a month ahead of one of the country’s most sensitive political gatherings, citing increasing risks from its rapid build-up of debt. On geopolitical front, North Korean leader Kim Jong Un blasted U.S. President Donald Trump as “mentally deranged” on Friday and vowed to make him pay dearly for threatening to destroy his country, hours after Trump ordered fresh sanctions over Pyongyang’s weapons programs.
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