RBC’s Gero: Gold Soars On Mideast Tensions, Steep Declines In Global Equities
Monday January 04, 2016 11:03
Gold futures are having a happy New Year so far, hitting their strongest level in nearly four weeks. The Comex February contract is up $16.80 to $1,077 an ounce and peaked at $1,083, the highest price since Dec. 9. “With the Middle East tensions, general stock sell-off in the world, China sneezing and all of us catching a cold, the gold up move was expected,” says George Gero, vice president with RBC Capital Markets Global Futures. “Technicals are still negative as we need a move over $1,100 to attract asset allocators and for investors to act positively after all the disappointments last year. Currency devaluations, possibly Argentina, Brazil (and)China, may add to investors’ concerns and gold may attract attention soon.” Tensions have arisen between Saudi Arabia and Iran, and Chinese equities tumbled overnight after a weak manufacturing survey. The Dow Jones Industrial Average is down by around 422 points.
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