Diamond News

Gold traded higher last night, climbing in a range of $1279.10 - $1285.65.  The yellow metal was lifted by a further drop in global bond yields (Japan’s 10-year to -0.096% - near 3-year low, German 10-year bund to -0.174% - near 3-year low, UK gilt to 0.901% - 19-month low, US 10-year to 2.226% - 20-month low) and continued weakness in global equities.  The NIKKEI fell 1.2%, the SCI gained 0.2%, European shares were off from 1.3% to 1.7%, and S&P futures were -0.8%.  Stocks were hurt by the ratcheting up of tensions in the US-China trade war, with China’s state-run media saying Beijing is considering limiting the export of rare earths, and Huawei filing a motion for summary judgment in its lawsuit against the US government.  A decline in oil (WTI from $59.09 - $57.43, worries of eco slowdown from prolonged trade dispute overshadow ongoing supply issues) contributed to the weakness in equities.  A modestly firmer dollar limited gold’s gain, however, as the DX rose from 97.95 – 98.06.  The DX was lifted by continued weakness in the euro ($1.1172 - $1.1147, weak German employment data, ECB’s Rehn says first rate hike is now further away) and softness in the pound ($1.2665 - $1.2626, growing concerns of a no-deal Brexit). 

US stocks opened weaker (S&P -25  to 2779) with losses in the Energy, Health Care and Consumer Discretionary sectors leading the decline.  The US 10-year bond yield continued to plunge, making a fresh 20-month low at 2.22%.  The DX firmed, however (DX to 98.14), lifted by further weakness in the euro ($1.1135).  Gold was caught in the cross currents, but traded lower to $1282 in a choppy fashion.  

Equities continued to soften into mid-day (S&P -36 to 2766), with a further decline in oil...

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