Gold was down on Tuesday morning in Asia’s precious metals as the dollar gained strength. A swift rise in U.S. tech stocks also took investors’ attention away from the precious metal.
Gold futures fell 0.65% at $1,916.35 by 12:41 AM ET (4:41 AM GMT)
The yellow metal fell in Asia’s morning trade after a flat previous session. The greenback strengthening gave gold its downwards trend, with major rises in U.S. tech stocks. Apple and Amazon, in particular, are also providing headwinds.
Some investors have renewed their hopes for a U.S. COVID-19 stimulus package. The White House claims that the U.S. Senate will go along with President Donald Trump’s new proposed legislation. These were found to be positive drivers for the precious metal.
In addition, investors are also factoring in a likely win by Democrat Joe Biden in the presidential elections. This is seen as leading to a much larger stimulus package than currently proposed.
All these factors, combined with the continued rise of COVID-19 cases globally, helped reduce the downward pressure of the dollar. Prices were beginning to flatten out in later trading.
Last week, the global gold-backed exchange traded products saw their holding surpass 1,000 tonnes for the year in September. This was a new record high, according to the World Gold Council.
Oil Rises, but Worries of Oversupply Remain
Oil rose on Tuesday morning in Asia’s energy commodities, staging a slight recovery from the previous day’s 2.9% decline. However, oversupply fears remain with the continued rise in COVID_19 cases.
Oversupply continues to dog the market as COVID-10 continues to slash global demand.
Brent oil futures rose 0.19% to $41.80 by 11:38 PM ET (3:38 AM GMT). WTI futures gained 0.23% to $39.52.
Recent supply outages that have assisted oil prices are coming to an end. This led to the strong fall in the previous trading session.
Hurricane Delta passed through the U.S. Gulf of Mexico in the previous week. The region rigs are now coming back onstream.
In Norway, an agreement has been reached between striking oil workers and management. This ended a strike that had disrupted 8% of Norway’s output.
A further oversupply factor is coming from Libya. The Sharara field had its force majeure embargo lifted on Oct. 11.
The field is expected to reach 300,000 bpd if it returns to pre-embargo levels. That’s nearly doubling the North African Organization of Petroleum Exporting Countries (OPEC) member’s current output.