The return of volatility to the financial markets is beginning to leave the direction of the precious metals uncertain.
Spot gold traded as high as $1,324/oz overnight but fell sharply before this morning’s opening bell.
The yellow metal recovered to about $1,322 per ounce on Monday, up $6.50 (+0.5%).
Meantime, spot silver added 19¢ (+1.15%) to $16.52/oz.
Platinum was a notch below unchanged at $962/oz.
The palladium price overtook platinum again, trading 0.4% higher to $973/oz.
World Financial Markets Sustain Volatile Action
The sudden rise in volatility over the past two weeks remains the defining feature of market activity.
It has caused a record number of long positions on the VIX, the leading volatility index. The VIX tripled last week.
Although the dramatic movement has led to some mild risk aversion, this is being mostly offset by investors “buying the dips.”
Shares on Wall St were up about 1.3% in early trading.
Across the Atlantic, European stocks rebounded over 1% from their worst week in a year.
Similarly, London’s FTSE 100 rose 1.1%, recovering from its lowest in more than a year.
The pound sterling traded at $1.38 while the euro inched lower to $1.225.
This left the U.S. dollar mostly unchanged. The DXY index was down marginally but held above 90.35.
The Japanese yen was off slightly to ¥108.6. The country’s stocks last closed down about 2% but markets elsewhere in Asia performed much better overnight.
Elsewhere: Bombs, Bonds, and Oil
In international news, another crisis could spark in the Middle East after Israel and Syria exchanged blows in a border confrontation.
Anti-aircraft fire from Syria downed an Israeli F-16, which prompted a retaliatory airstrike of Syrian military positions. Western powers denounced Iranian involvement in the skirmish.
The energy market saw a slight rebound following a slump of more than 9% for oil prices last week.
Rising production could keep crude prices down for the time being. The U.S. rig count is at its highest in more than 2-and-½ years.
WTI crude traded back up 1.2% this morning but was shy of $60 per barrel.
The potential for a “spike” in interest rates, according to President Trump’s budget director Mick Mulvaney, continues to loom over the bond market.
10-year Treasury yields nearly touched 2.90% before trading back at 2.85%.
Meanwhile, Congress is moving on to tackling new spending on infrastructure as well as the president’s initiative for a border wall with Mexico.
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