Gold Rises Along With North Korea Tensions

Cornelia Mascio
Agosto 13, 2017

A weaker opening on Wall Street further added to the downward pressure in Europe.

Outside the political arena, declines in a pair of technology stocks added to the cautious tone on the day.

NASDAQ measures a number of indices reflecting the reaction of USA's high tech markets and business environments on the country's political and economic developments which have an impact on high tech markets.

Gold prices rose to their highest level in two months Thursday, as an escalating war of words between the USA and North Korea drove investors into haven investments.

The dollar index .DXY , which measures the US currency against a basket of other major currencies, fell 0.14 percent.

But according to ICBC Standard Bank's Yuichi Ikemizu, the dollar is still weak and on a downtrend, which could help gold prices inch higher in the short term.

Equities slid and the Swiss franc and some developed-market government bonds advanced as President Donald Trump threatened North Korea with "fire and fury" following a series of missile tests by the communist regime, boosting demand for haven assets.

U.S. stock indexes opened lower on Wednesday as investors turned risk averse following rising tensions between North Korea and the United States.

Pyongyang said it was examining plans for attacking Guam, a USA territory in the Pacific with a military base. Economists had expected prices to rise by 0.2 percent.

In the eurozone, the Paris CAC 40 lost 0.3 percent compared with the closing level on Wednesday.

(Employees push a trolley laden with crates of one kilogram gold bars at the YLG Bullion International Co. headquarters in Bangkok, Thailand.Getty Images/Dario Pignatelli/Bloomberg) Gold has rallied 2.3% this week on the heels of renewed tension with North Korea.

At 3:15pm BST, the Comex gold futures contract for December delivery was up 1.09% or $13.90 to $1,293.20 an ounce, as the precious metal extended overnight gains, of almost 2% stateside, with yet another rally in Asia and Europe.

China's Shanghai Composite Index plunged 51.94 points or 1.6% to 3,209.80, as investors continued to book profits in cyclical sectors.

Commodity-related stocks are among the worst performers against the backdrop of heightened political uncertainty after Trump further ratcheted up the rhetoric.

Investors bought bonds after the Labor Department said the consumer-price index increased 0.1% in July from the previous month.

Canadian Tire Corp Ltd rose 3.4 percent to C$146.65. South Korea's Kospi lost 1.7 percent, while Hong Kong's Hang Seng slid 2 percent. ANZ fell 1.9%, Commonwealth shed 0.7% and Westpac declined 1.3% after RBA Governor Philip Lowe said the central bank is prepared to be patient on rates for quite some time.

Bond prices were little changed. Japan was closed on a public holiday.

The yield on the benchmark 10-year Treasury note settled at 2.191%, its lowest close since June 26, compared with 2.211% Thursday and 2.269% last Friday. Australia's S&P/ASX 200 dropped 1.2 percent to 5,693.10.

Macy's shares closed down 10.2 per cent and Kohl's fell nearly 6 per cent as the companies continued to report a drop in quarterly same-store sales, stoking concerns that their turnarounds may still be a long way off.

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