(Kitco News) - Gold and silver prices are sharply higher in early U.S. trading Monday, with spot gold and nearby Comex gold futures scoring record highs. Silver prices notched a 14-year high today. Safe-haven demand is featured as the turbulent month of September is under way and amid uncertainty regarding the legality of U.S. tariffs. December gold was last up $47.30 at $3,563.40. September silver prices were up $0.915 at $41.13.
Safe-haven demand is seen for the two precious metals as the prospect of Federal Reserve rate cuts and growing concerns over the U.S. central bank’s independence propel the two precious metals. Gold has risen more than 30% this year, making it one of the best-performing major commodities. Spot gold traded as high of $3,508.00 an ounce today. Nearby silver futures hit a high of $41.34 an ounce. Silver is up by more than 40% so far this year.
Global stock markets were mostly lower overnight. U.S. stock indexes are pointed to lower openings when the New York day session begins.
In overnight news, Last Friday’s U.S. appeals court ruling that said most U.S. tariffs are illegal has injected uncertainty into the marketplace to start the U.S. holiday-shortened trading week, and into President Trump’s authority to impose the import duties. The judges ruled 7-4 that sweeping U.S. global tariffs exceeded the authority granted under the 1977 International Emergency Economic Powers Act (IEEPA). The Federal Circuit said Congress never delegated the power to impose tariffs through IEEPA, calling the policy an “unheralded” and “transformative” overreach. The appeals judges let the levies stay in place while the case proceeds, but it threatens to freeze corporate investment decisions until the cost of tariffs are clearer. Bond yields are on the rise early this week, along with the sell offs in equities markets. September is historically the worst-performing month for the U.S. stock market.
The yield on long-dated United Kingdom government bonds rose to the highest level since 1998 and the British pound dropped early this week, pressuring U.K. Prime Minister Keir Starmer’s government to regain the confidence of investors who remain concerned over the fiscal outlook. The rate on U.K. 30-year gilts rose five basis points to 5.69% today amid a global decline in government bonds. The British pound tumbled, falling as much as 1.3% to $1.3376 against the U.S. dollar and lagging all other major currencies. The FTSE 100 stock Index retreated by 0.5%. Rising debt costs threaten to worsen a bleak fiscal backdrop facing Chancellor of the Exchequer Rachel Reeves ahead of her autumn budget. “The situation in the U.K. is quite dangerous at the moment because of the return of the bond vigilantes,” said Ludovic Subran, Allianz chief investment officer, as reported by Bloomberg. “What is striking is that it took so long to factor in the return of inflation into gilts. Forward guidance on the fiscal side will be needed.”
Russia's Gazprom has signed an agreement to build a natural gas pipeline to China via Mongolia. The Russian gas producer could ship as much as 50 billion cubic meters a year via the pipeline for 30 years, at a price lower than what Gazprom currently charges customers in Europe, said a Bloomberg report. Gazprom has also agreed to raise flows to China via the existing Power of Siberia route and the future Far Eastern link, with details on construction timeline, price negotiations, and financial terms yet to be disclosed.
The key outside markets today see the U.S. dollar index firmer, with crude oil prices slightly down and trading around $64.25 a barrel. The yield on the U.S. Treasury 10-year note is presently 4.23 percent.
U.S. economic data due for release Tuesday includes construction spending, the ISM Manufacturing Index, the JOLTS job openings report and light vehicle sales.
Technically, December gold futures bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $3,600.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $3,400.00. First resistance is seen at today’s high of $3,578.40 and then at the contract high of $3,585.80. First support is seen at $3,500.00 and then at $3,480.00. Wyckoff's Market Rating: 8.5.
September silver futures bulls have the solid overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at $45.00. The next downside price objective for the bears is closing prices below solid support at $38.00. First resistance is seen at today’s high of $41.34 and then at $42.00. Next support is seen at the overnight low of $40.185 and then at $40.00. Wyckoff's Market Rating: 8.5.
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