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BMO: ETF gold holdings rise for 12 consecutive days

Kitco News

Holdings of gold by physically backed exchange-traded funds have risen for 12 consecutive business days, said BMO Capital Markets. The ETFs trade like a stock but track the price of gold, with the commodity put into storage to back the shares. Holdings continue to rise as “portfolio positioning retains a defensive hedge amid coronavirus concern,” BMO said. On Thursday, these holdings rose by another 112,000 ounces, taking net purchases over the year to date to 1.65 million ounces. Analysts also cited World Gold Council data showing that 61.7 metric tons of gold were added in January, over half of which were by European funds. “This asset allocation annuity continues to support gold prices above $1,566/oz, despite a relative lack of traditional retail consumers,” BMO said.

By Allen Sykora of Kitco News; asykora@kitco.com

 

Price Group’s Flynn: gold holds up after data amid ongoing virus worries

Friday February 7, 2020 08:52

Gold prices have held up well considering the Labor Department issued a stronger-than-forecast report on U.S. nonfarm payrolls, said Phil Flynn, senior market analyst with Price Futures Group. The economy added 225,000 jobs last month. Normally, this might pressure gold, he said. Stock futures initially blipped up and gold down, but then they quickly undid those moves and gold has only modest losses, he said. In the current environment, many market participants are maintaining exposure to the yellow metal due to worries about the coronavirus, he continued. “Our belief is we will see a little support because of the concerns about the coronavirus continuing,” he said. Despite the strong jobs report, Comex April gold futures were up $2.10 to $1,572.10 an ounce as of 8:36 a.m. EST.

By Allen Sykora of Kitco News; asykora@kitco.com

 

FXTM: ‘coast isn’t all clear’ so investors still want safe havens

Friday February 7, 2020 08:52

Investors are still holding so-called safe-haven assets, worried “the coast isn’t all clear,” despite the recent surge higher in equities, said Han Tan, market analyst at FXTM. The analyst pointed out that
gold remains above the $1,560 psychological level, still up by more than 3% so far in 2020, while U.S. 10-year Treasury yields are around 15% lower since the start of the year. “With so much uncertainty still around the coronavirus outbreak, especially about its implications on the global economy, perhaps investors are getting complacent about the severity of the total economic toll, hoping that monetary and fiscal support can come to the rescue,” Tan said. “While stocks may continue riding on such hopeful sentiment, other assets such as Asian currencies and major commodities may be more reflective of the economic fundamentals, as the outbreak remains a major negative risk.”

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.