Gold Drifted Lower

Gold Drifted Lower

Gold drifted lower early Friday on signs of a U.S.-China trade accord and as investors awaited U.S. GDP data to gauge the strength of the economy. Palladium remained near a record high reached Tuesday.

U.S. Treasury Secretary Steven Mnuchin said Thursday that the two superpowers would sign a phase-one trade agreement in early January, telling CNBC that the deal had been inked and translated and wouldn’t be subject to any renegotiation.

“It’s just going through what I would consider to be a technical, legal scrub,” he said.

The two sides announced that an agreement had been reached last week, and investors have been waiting on details and indications that it will go through. Gold climbed throughout the year when it appeared the negotiations had stalled. It has largely been rangebound since news of the accord broke, reducing gold’s appeal as an investment hedge, particularly as equities have rallied.

February gold futures rose 0.4% Thursday to settle at $1,484.40 an ounce on Comex, the highest level in more than two weeks. Gold got some support Thursday after Donald Trump became the third president in U.S. history to be impeached late Wednesday, triggering some investors’ flight to quality. The metal advanced 0.2% in the first four days of this week.

The Standard & Poor’s 500 reached a new record above 3,200 for the first time Thursday, closing at 3,205.37.

Palladium, which reached a record above $2,000 an ounce on Tuesday, advanced 0.8% Thursday to $1,932.59 amid a global supply crunch for the metal used in autocatalysts. It increased 0.3% in the first four days of the week.

Revised U.S. third-quarter GDP numbers are due out Friday. The second report from the Bureau of Economic Analysis in November showed real GDP grew 2.1% after expanding 2% in the second quarter.

Friday also brings what historically can be a volatile trading day, known as quadruple witching. Occurring once a quarter, quadruple witching refers to the expiration on the same day of stock-index futures, stock-index options, stock options and single stock futures.

Silver rose 0.6% Thursday, with the March futures contract settling at $17.15 an ounce on Comex. It increased 0.8% in the first four days of the week. Spot platinum slipped 0.2% Thursday and was up 0.6% in the first four days of the week.


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