FTSE 100 drifts as Gold drops through $3,200

Chris Beauchamp IG

It has been another tough day for gold, while the FTSE 100 continues to struggle around 8600, says Chris Beauchamp, Chief Market Analyst at online trading platform IG.

US markets keep rising but Europe edges back

Investors continue to pile back into US markets, but European markets have seen some losses today. Having returned to record highs, the Dax looks vulnerable to some short-term selling, while the FTSE 100 seems to have a ceiling for the time being around 8600. Nonetheless, the tariff truce and cooling inflation should continue to underpin gains for stocks in the weeks to come.

Gold slumps below $3200

While the current ceasefire in the global trade war may do wonders for equities, it has proven to be a burden for gold. The price lost $3200 today, and overall the commodity continues to look like it is in for an extended period of consolidation. Fund flows should continue to favour US stocks in the short-term, and as the current ‘most crowded trade’ gold seems vulnerable as some investors reduce their exposure.

Author

Chris Beauchamp

EUR/USD bounces off lows, back to 1.1860

EUR/USD now manages to regain some balance, retesting the 1.1860-1.1870 band after bottoming out near 1.1830 following the US NFP data on Wednesday. The pair, in the meantime, remains on the defensive amid fresh upside traction surrounding the US Dollar.

GBP/USD rebounds to 1.3660, USD loses momentum

GBP/USD trades with decent gains in the 1.3660 region, regaining composure following the post-NFP knee-jerk toward the 1.3600 zone on Wednesday. Cable, in the meantime, should now shift its attention to key UK data due on Thursday, including preliminary GDP gauges.

Gold stays bid, still below $5,100

Gold keeps the bid tone well in place on Wednesday, retargeting the $5,100 zone per troy ounce on the back of humble gains in the US Dollar and firm US Treasury yields across the curve. Moving forward, the yellow metal’s next test will come from the release of US CPI figures on Friday.