Gold Solidly Lower As Risk Appetite Is Back; Outside Markets Also Bearish

(Kitco News) - Gold prices closed the U.S. day session solidly lower Tuesday, as “risk-on” trader and investor attitudes are dominating the marketplace so far this week. More profit taking from the shorter-term futures traders was also featured after prices past week hit a two-year high. August Comex gold was last down $20.40 an ounce at $1,271.70. July Comex silver was last down $0.214 at $17.30 an ounce.

The key “outside markets” on Tuesday saw the U.S. dollar index higher and Nymex crude oil prices weaker. That was a bearish daily posture for the precious metals and the raw commodity sector.

Federal Reserve Chair Janet Yellen’s testimony on the economy monetary policy before the U.S. Senate Banking Committee produced no bombshell pronouncements. However, she did continue to imply the Fed is in no hurry to raise U.S. interest rates, mainly due to tepid U.S. economic growth and productivity prospects. Her remarks did not significantly move markets.

World stock markets were again mostly higher Tuesday and U.S. stock indexes were firmer in afternoon New York dealings. The better risk appetite in the marketplace this week is due to polls showing Thursday’s U.K. vote on whether that country stays in or leaves the European Union favor the “stay” camp. However, the polls are close, which is still causing a bit of uncertainty in the marketplace, and will continue to do so until Thursday’s vote. London bookmakers are saying the odds are about 75% the U.K. will stay in the EU. A U.K. vote to leave the EU would likely create high uncertainty and tensions in world stock, currency and financial markets. Thursday’s vote could be the most important world markets event of the summer.

U.S. economic data due for release Tuesday is light and includes the weekly Goldman Sachs and Johnson Redbook retail sales reports.

Courtesy: Kitco News