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Jan. 26, 2021, 3:27 p.m. EST

Gold down a fourth session to log longest string of losses in over 8 months

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By Myra P. Saefong and Mark DeCambre

Gold futures settled lower on Tuesday for fourth-straight session, marking the longest string of consecutive losses in more than eight months.

The move for the metal came on the first day of Federal Reserve’s two-day policy session, which concludes Wednesday. The central bank’s statement Wednesday may reveal further insights about the health of the U.S. economy amid the COVID-19 pandemic.

Monetary accommodation will be “the predominant theme for the time being, especially while COVID and its economic consequences are felt,” Stephen Flood, director of bullion services at GoldCore in Dublin, told MarketWatch. “A potential vicious rise in new COVID variant U.S. cases in February/March may test the broader economy and, as such, rumoured ‘taper talk’ may prove premature at this stage,” he said, implying potential support for gold.

“Broad market [speculators] are seeking affirmation that nothing will be said or done to tamper with the ongoing market support,” he said.

On Tuesday, February gold /zigman2/quotes/210034565/delayed GC00 -1.18%  lost $4.30, or 0.2%, to settle at $1,850.90 an ounce, after a nearly 0.1% slide on Monday. Tuesday’s represents the longest streak of lower settlements for a most-active contract since a five-session slide ended on April 30, FactSet data show. The February contract has largely been in a range between $1,817 and $1,824 though since the start of the year and first notice day is on Friday Jan. 29 with the contract expiry due on Feb. 24.

Silver for March delivery /zigman2/quotes/210315219/delayed SI00 -0.41% /zigman2/quotes/211961204/delayed SIH21 -0.41% added 5 cents, or 0.2%, at $25.538 an ounce, following its 0.3% decline in the prior session.

Bullion trade has been sensitive to expectations for further government spending as the administration of President Joe Biden aims to promote a $1.9 trillion COVID relief package, which is viewed as bullish for gold investors. Presumably, the “smoother” the passage of the relief package, “the more favourable for gold,” said Stephen Innes, chief global markets strategist at Axi.

The yellow metal also has tended to move in step with weakness in the U.S. dollar and vacillations in government bond yields, which compete with bullion for haven demand.

However, on the central bank front, the highlight is the FOMC decision on Wednesday.

“The FOMC meeting should be gold supportive, but not new news,” said Innes, in a recent note.

“Robust GDP data could weigh on gold if yields react higher, but aid silver” and the platinum group metals, he said. U.S. GDP data for the fourth quarter will be released on Thursday.

On Comex, April platinum /zigman2/quotes/216224626/delayed PLJ21 -0.52% added 0.2% at $1,107.40 an ounce and March palladium /zigman2/quotes/215784886/delayed PAH21 +0.70% settled at $2,325 an ounce, down 0.9%.

March copper /zigman2/quotes/210055581/delayed HGH21 -0.33% fell by 0.3% to $3.6195 a pound.

/zigman2/quotes/210034565/delayed
US : U.S.: Nymex
$ 1,776.60
-21.30 -1.18%
Volume: 213,822
Feb. 25, 2021 11:34a
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/zigman2/quotes/210315219/delayed
US : U.S.: Nymex
$ 27.75
-0.11 -0.41%
Volume: 8,240
Feb. 25, 2021 11:34a
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/zigman2/quotes/211961204/delayed
US : U.S.: Nymex
$ 27.75
-0.11 -0.41%
Volume: 8,240
Feb. 25, 2021 11:34a
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/zigman2/quotes/216224626/delayed
US : U.S.: Nymex
$ 1,251.40
-6.50 -0.52%
Volume: 9,500
Feb. 25, 2021 11:34a
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/zigman2/quotes/215784886/delayed
US : U.S.: Nymex
$ 2,439.00
+16.90 +0.70%
Volume: 336.00
Feb. 25, 2021 11:34a
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/zigman2/quotes/210055581/delayed
US : U.S.: Nymex
$ 4.28
-0.01 -0.33%
Volume: 13,612
Feb. 25, 2021 11:34a
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