volatility in precious metals went into overdrive this morning as gold spot
contracts skyrocketed first to the short-lived stratospheric highs above
$1980/toz in early Asian hours and then nuzzled into the mud of a fleeting low
at $1907/toz in the European morning. Afterwards they managed to recover by $15
higher again in several minutes and touched $1935/toz before the noon. The
range of jumps reached as much as 15% for silver futures, which managed to draw
alternately $26.15 and $22.25, and $24 again on intraday charts.
banks keep the "money printers" running. the spot gold contracts
traded as high as $1,944 per troy ounce in early hours today. The yellow metal
prices have already surpassed the previous historical record set in September
2011, and the upward pressure is still not easing after the European noon.
Yen, another safe haven asset, which is suffering after huge amounts of
quantitative easing (QE), as everybody realises that it is just another name
for the "money printing press", has strengthened significantly over
the past couple of days against the Dollar.
Gold prices jumped brilliantly on Thursday trying to break through the $1900/toz psychological landmark. All precious metals, including platinum, silver and even palladium managed to show new highs of the year even before the downward spurt of a quick technical correction on U.S. stock indexes. Gold futures followed by the spot and CFD contracts continued to besiege the $1,900 fortress on Friday morning, probably forcing the market crowd to not collect their profits yet.
was mostly of risk aversion. The news that the United States Congress delayed
the presentation of a new stimulus package on the economy ended up motivating
this market sentiment.
tensions between the US and China have penalized Europe. The Stoxx Europe 600
index fell 0.9%, DAX fell 0.5%, CAC 40 lost 1.3% and FTSE 100 fell 1%. In the
United States, markets managed to resist losses and ended up closing the day in
the debt market fell again yesterday. The U.S.
Markets continue to react in a predominantly positive way to the information coming from news feeds using a clearly risk-on approach. Such a conclusion seems to be confirmed at the moment, not so much by some new summer records for the U.S. S&P500 broad market index, where the fresh upward movements are still accompanied by pullbacks almost every day, but more by the fact that safe-haven potential of the U.S. Dollar is seemingly being ignored.
For example, Pfizer and BioNTech yesterday announced a new agreement with the U.S. Government that already placed an initial $1.
the markets had a greater appetite for risk. European Union leaders have agreed
on a recovery plan. Good prospects for an Oxford vaccine are also enlivening
Europe 600 index rose 0.3%, after European officials reached a historic
agreement on the terms of the recovery plan. In the United States, the Dow
Jones appreciated 0.60% while the S&P500 grew 0.17% and the Nasdaq fall 0.81%.
Treasurys and European bonds showed a moderate reaction on Tuesday to the deal
on the European Union recovery fund.
While European and global stock markets are making a pullback after a spectacular jump at the beginning of the week, the U.S. Dollar is crawling just a little higher against the basket of major reserve currencies keeping its weakening overall trend intact. In particular, after a brief decline to the area of 1.1505 before noon, the single European currency soared again above 1.1540 vs its American competitor, as the Euro-nominated assets are getting support by the New Generation EU stimulus package adopted by the Old World leaders.
The recent decline of the U.S. Dollar prompted a “mainstream” suggestion that the American currency is moving towards the underworld. For example, some expect the Euro to climb to the 1.30 level versus the Dollar. Mizuho Bank analysts suggest that the recently approved UE recovery fund worth 750 billion Euros will complement this decline as this recovery plan suggests huge EU nations’ borrowings denominated in Euros. This move will create a steady cash inflow in government bonds and may raise the demand for the Euro.
was marked by a reversal of market sentiment. The day started out with a
feeling of risk aversion, but ended with the possible conclusion of the negotiations
on the European recovery fund, as well as with positive expectations regarding
an Oxford vaccine, which is most probably the cause of greater confidence in
Stoxx600, an index that aggregates the 600 highest quoted shares in the Old
Continent, closed at 0.75% to 375.51 points. The US indexes appreciated, with a
rise of the Dow Jones by 0.03% while the
S&P500 appreciated by 0.
Even before the happy end of the five-day historical European summit, this summer's newly updated record above the 3,250 mark on the broad-based U.S. S&P500 index late in New York set a very positive tone for the global markets. This American mood was caught by the European wings and was then raised even higher with fresh four-month highs of the Euro Stoxx 50 composite index and also by national German and Italian stock indexes. The French CAC40 index is still on track to repeat its peak values of June.