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Gold futures fell for a second straight session on Tuesday as disappointing economic data from China, a credit rating warning for U.S. banks, and some weak corporate earnings resulted in some flight to the safety of the U.S. dollar and Treasuries.
Price action
-
Gold for December delivery
GC00,
-0.42% GCZ23,
-0.42%
fell by $5.20, or 0.3%, to $1,964 per ounce on Comex. -
Silver futures for September delivery
SI00,
-1.75% SIU23,
-1.75%
fell by 16 cents, or 0.7%, to $23.07 per ounce. -
Palladium futures for September
PA00,
-2.36% PAU23,
-2.36%
declined by $24.20, or 2%, to $1,212 per ounce, while platinum futures for October
PL00,
-2.85% PLV23,
-2.85%
fell by $15.20, or 1.6%, to $911 per ounce. -
Copper futures for September
HG00,
-2.19% HGU23,
-2.19%
declined by 9 cents, or 2.3%, to $3.75 per pound.
Market drivers
China’s exports fell sharply in July, while Moody’s Investors Service’s put its credit rating on a handful of U.S. banks on review, and United Parcel Service Inc.
UPS,
seen as a bellwether for economic growth, cut its full-year guidance.
The news weighed on stocks, and sent U.S. equity futures lower in premarket trade, with S&P 500 index futures down 0.7% at 4,503. Amid the risk-off wave, investors appeared to favor the U.S. dollar and bonds over gold as yields declined, while the yellow metal traded modestly lower.
The ICE U.S. Dollar Index DXY, a gauge of the greenback’s strength against major currencies, rose 0.5% to 102.54.
The yield on the 10-year Treasury note
BX:TMUBMUSD10Y
was off by 9.5 basis points at 3.994%, dropping back below the closely watched 4% threshold.
“Despite broad dollar strength, gold is holding nicely considering all the selling that is hitting the other commodities. If the global economic outlook deteriorates further, gold should catch a bid here,” said Edward Moya, senior market analyst at OANDA, in emailed commentary.
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