- Equities, pound gain on speculation of more policy action
- Copper futures touch the highest in seven weeks in New York
Gold fell back and copper soared as global markets stabilized on speculation that policy makers will do more to curb the post-Brexit fallout.
Bullion fell after its biggest two-day surge in seven years as European and U.S. equities and the pound climbed for the first time since the U.K. voted to leave the European Union. Concern that an exit will disrupt the global economic recovery had caused market turmoil and boosted gold by 5.4 percent in just two days as investors sought a haven.
“We have stock markets all around the world consolidating and rebounding from the panic selling, so we’ll be getting into stocks and a little out of gold based on fear of the Brexit just about ending,” James Cordier, the founder of Optionsellers.com in Tampa, Florida, said by phone. “By the end of the week, Brexit will have been digested and gold will probably settle around this level.”
Gold for immediate delivery slid 0.7 percent to $1,315.34 an ounce at 2:15 p.m. in New York, according to Bloomberg generic pricing. Prices have climbed 24 percent this year.
Copper advanced to the highest in seven weeks after Chinese Premier Li Keqiang said the nation would act to ensure stability, while Japanese stocks rose on optimism over the possibility of further stimulus. Fed funds futures show there is higher probability the Federal Reserve will cut rather than raise U.S. interest rates this year. Aluminum, zinc, nickel, lead and tin also gained on the London Metal Exchange as the dollar fell.
“England won’t account for much drama with base metals: China consumes 50 percent to 70 percent of the six main base metals we follow, and no one else can move the needle,” Ed Meir, an analyst at INTL FCStone Inc. in New York, said by phone. “We’re set up for a good rally now that the dollar is weaker again.”
Copper for delivery in three months climbed 2.3 percent to $4,818 a metric ton ($2.19 a pound) on the LME, the seventh gain in eight sessions. Earlier, the metal touched $4,830, the highest since May 5.
Also helping metals prices was a report showing the U.S. economy expanded more than previously projected in the first quarter.
In other metals news:
- Copper futures for September delivery gained 2.4 percent to settle at $2.1755 a pound on the Comex in New York.
- Gold futures for August delivery dropped 0.5 percent to $1,317.90 an ounce, while silver futures for September delivery gained 0.6 percent to settle at $17.889 an ounce.
- Gold assets in exchange-traded funds rose 12.6 metric tons to 1,934.7 tons as of Monday, the highest since September 2013, data compiled by Bloomberg show.
- On the New York Mercantile Exchange, platinum was little changed and palladium rose.