Equity world–Gold futures on the COMEX division of the New York Mercantile Exchange tumbled on Wednesday (Thursday morning GMT), as traders consider the outcome of the US presidential elections.
The most active gold contract for December delivery fell one dollar, or 0.08 percent, to settle at 1273.50 dollars per ounce. US presidential candidate Donald Trump became US president elect between the close of the market on Tuesday and re-opening on Wednesday morning. Analysts noted that, despite the huge surge in early trade in gold and a massive decline in the US equity options, precious metals stabilized before the market opened and ended lower after the market closes. The Dow Jones Industrial Average rose 299 points, or 1.25 percent at 18:15 GMT.
Analysts noted that while equities posted a loss of precious metal usually rises, as investors sought a safe haven. Meanwhile, instead when US equities posted gains, the precious metal biasanyan down. Gold was put under pressure as the US dollar index rose 0.6 percent to 98.55 at 18:15 GMT. The index is a measure of the US dollar against a basket of major currencies. Gold and the dollar usually move in opposite directions, which means that if the US dollar rises, the gold futures will fall, because gold is measured in dollars, become more expensive for investors.
There are no major economic reports released on Wednesday, but on Thursday will see the release of weekly jobless claims and consumer sentiment on Friday. Traders are still considering the possibility of higher interest rates on the US Federal Reserve in December. Investors believe the Fed will raise interest rates from 0.50 to 0.75 during the month’s FOMC meeting.
According Fedwatch tool CME Group, the implied probability at this time to raise interest rates from 0.50 to 0.75 is at least 76 percent at a meeting in December and 77 percent for a meeting in February 2017. Silver for December delivery rose 2.2 cents, or 0 , 12 percent, to close at 18.378 dollars per ounce. Platinum for January delivery dropped 5.3 dollars, or 0.53 percent, to 1003.30 US dollars per ounce, Xinhua reported.