Gold slips 1% as small signs of progress against coronavirus boost stocks – CNBC

Freshly cast gold ingot bars sit in the foundry at the JSC Krastsvetmet non-ferrous metals plant in Krasnoyarsk, Russia, on Tuesday, Nov. 5, 2019.

Andrew Rudakov | Bloomberg | Getty Images

Gold prices fell 1% on Tuesday,retreating from a one-month high hit earlier in the session asrisk sentiment improved on wider market optimism after therewere tentative signs of progress against coronavirus outbreaksin some countries.

Spot gold was down 0.5% at $1,653.25 per ounce by1024 GMT after rising to a one-month high of $1,671.40. Themetal had risen as much as 2.8% on Monday.

"Risk appetite is back in the markets as new infections aredeclining, that's weighing on gold prices. Also higher yieldsare negative for gold," said Quantitative Commodity Researchanalyst Peter Fertig.

"However, some investors fear that monetary policy wouldlead to inflation. For them, buying gold at these levels remains attractive."

Cautious optimism around a slowdown in new coronavirus casesin some countries lifted European shares higher for a secondday, even as major companies continued to take steps to shore upcash after lockdowns crushed global demand.

More than 1.32 million people have been reported as infectedby the virus across the world and 74,087 have died. BritishPrime Minister Boris Johnson was taken into intensive care onMonday after his symptoms worsened.

The pandemic has rattled financial markets around the worldover the course of the last quarter and prompted nations toextend lockdowns to curtail its spread.

Japanese Prime Minister Shinzo Abe was set to announce astate of emergency for the capital, Tokyo, and six otherprefectures and unveiled plans for a stimulus package to supportthe economy.

"Gold investors are revelling in the level of central bankstimulus and fiscal spending, especially when it raisesgovernment debt levels," said Stephen Innes, chief marketstrategist at financial services firm AxiCorp, in a note.

Indicative of sentiment, the holdings of world's largestgold-backed exchange-traded fund, SPDR Gold Trust, rose0.5% to 984.26 tonnes on Monday - its highest in over threeyears.

U.S. gold futures rose 0.5% to $1,703, extending alead over London spot prices and signalling market worries thatrefinery closures and logistics constraints could hamper bullionshipments to the United States to meet contract requirements.

The increase came despite measures from the CME Group's Comex Exchange to ease supply concerns and assurancesfrom the London Bullion Market Association.

Palladium was 2.3% higher at $2,203.36 per ounceafter rising more than 3% in early trading. Platinum climbed 1.2% to $744.02.

Silver jumped 1.1% to $15.15 an ounce, having toucheda more than three-week high earlier.

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Gold slips 1% as small signs of progress against coronavirus boost stocks - CNBC

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