Gold shines as Wall Street falters: Market turmoil and record highs




Whatever mysterious negatives spooked equity markets—especially Wall Street—on Tuesday slipped by gold. While major Wall Street indexes saw their biggest one-day falls for weeks, gold bounced to a new record high.

Factors floating around the markets on Tuesday were the weak policy announcements from China, more worries about Gaza, speculation over a Federal Reserve interest rate pivot, and concerns about the growing size of major tech companies (where the falls were large).

On Tuesday, spot gold rose as much as 1.3% to hit a new record of $2,141.60 per ounce before paring its gains to 0.6%.

Comex gold futures had a similar run, peaking at $US2,150.50 per ounce then falling to $US2,137.30 an ounce just before 8 am Sydney time Wednesday.

That means gold has added about $US100 in the past five sessions, thanks to continuing expectations for monetary easing, geopolitical tensions, and the rising risk of a pullback in equity markets.

Helping was a sharp near 8-point pullback in the 10-year T-bond yield to just over 4.13%.

And the rise in the gold price and a weak Aussie currency (down to just above 65 US cents) saw the Aussie dollar gold price leap to around $US3,272 an ounce.

Even though Wall Street’s slide saw a fall in the overnight ASX 200 futures market for the start of trading Wednesday morning, the jump in gold prices should provide some support for local miners.


Name Glenn Dyer

Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.