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Gold futures head for biggest monthly gain in 3 years

MARKETWATCH 10:12 AM ET 6/28/2019
By Myra P. Saefong, MarketWatch , Rachel Koning Beals

Gold futures moved modestly higher in Friday dealings, on track to score their biggest monthly percentage gain in three years following a climb to a nearly six-year higher earlier in the week.

The impending sideline meetings at the Group of 20 conference in Japan between U.S. President Donald Trump and his Chinese counterpart Xi Jinping held the attention of financial markets, as uncertainty around the trade standoff had been supportive for haven gold in recent sessions. Trump and Xi will likely use the G-20 meeting this weekend to "press pause" on their continuing trade war, but uncertainties persist, analysts have said (http://www.marketwatch.com/story/g- 20-preview-facing-faltering-economies-trump-and-xi-likely-to-agree-to-a-cease-fire-of-trade-war-2019-06-26).

August gold was up $1, or nearly 0.1%, at $1,413 an ounce. Prices had settled at $1,418.70 Tuesday before pulling back. That was the most highest settlement for a most-active contract since Aug. 28, 2013, according to FactSet data.

Gold is headed for a roughly 0.9% gain for the week, up some 7.8% for June. The monthly rise would be the largest for a most-active contract since June 2016, according to FactSet data. For the quarter, prices trade more than 8% higher.

Read:Why gold prices have climbed to their highest since 2013 (http://www.marketwatch.com/story/why-gold-prices-have- climbed-to-their-highest-since-2013-2019-06-21)

The precious metal was experiencing some "rebalancing," given the holiday-shortened trading week next week, which is also full of "upcoming headlines" with Trump and Xi set to meet Saturday, said George Gero, managing director at RBC Wealth Management. He also noted that international investors are also dealing with "global worries, [a] global pullback in economies and 22 countries or more having lower interest rates, so U.S. investments are the haven, with gold as a hedge."

Stocks traded in subdued fashion (http://www.marketwatch.com/story/dow-futures-rise-poised-for-best-june-in-80-years- as-all-eyes-turn-to-hoped-for-china-trade-progress-2019-06-28) and looked to end the week lower, but the Dow Jones Industrial Average was on track for the best June since 1938. The blue-chip index and gold were defying their typically inverse relationship with stellar June returns for both.

Gold gained in part as the leading dollar index slipped, making commodities priced in the U.S. unit, such as gold, more attractive to investors using other currencies.

Expectations for lower interest rates among global central banks and geopolitical concerns centered on trade spats and tensions with Iran had been making gold a preferred investment this spring, especially as competing low-risk U.S. Treasury bond yields dropped. The yield on the 10-year note fell below 2% in recent sessions.

On Friday, U.S. data revealed that consumer spending rose (http://www.marketwatch.com/story/consumers-boost-spending- in-may-as-incomes-rise-and-inflation-stays-low-2019-06-28) at a healthy clip, up 0.4% in May, though that's a tick below the MarketWatch forecast. Separately, the University of Michigan said the final reading of its consumer sentiment index in June (http://www.marketwatch.com/story/consumer-sentiment-weakens-in-june-on-tariff-concerns-2019-06-28) was 98.2, down from the 100 reading in May.

Read:How to get started with gold-coin investing (http://www.marketwatch.com/story/how-to-get-started-with-gold-coin- investing-2019-06-25)

Among other metals, the most-active September silver contract traded at $15.31 an ounce, up 1.6 cents, or 0.1%, for the session, looking at a monthly rise of about 4.5%. September copper traded little changed at $2.718 a pound, with the contract poised for a monthly rise of 2.9%.

October platinum was up 1.1% at $826.70 an ounce, trading around 3.4% higher this month, while September palladium lost 0.8% to $1,526.80 an ounce, but was holding on to a sharp monthly rise of almost 15%.

-Myra P. Saefong; 415-439-6400; [e-mail]


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06-28-191012ET
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