It is going to be a bad day for Australian gold stocks and their supporters with a big sell off in store.
That was after the prices of gold and other metals slumped overnight on global markets as the US dollar rose on fears about the economic impact of the UK staging a so-called ‘hard’ Brexit from the EU.
Also helping boost the dollar was more solid economic data for the economy, prompting some analysts to predict there will be a rate rise at the Fed’s meeting in December, though one Fed leader claimed (illogically to many others) it could come in November, just as the US election campaign is peaking.
The greenback’s strength saw the pound fall to new 31 year lows in trading overnight Tuesday – although the Aussie dollar firmed against the greenback to trade around 76.25 US cents at 8 am.
Oil rose with US futures topping $US49 a barrel, despite the stronger greenback.
Gold though took the brunt of the selling. The 3.3% slide in Comex futures for the current month was the biggest one day fall for nearly 3 years.
Shares of gold-mining companies also fell and our market will see a sell off in gold stocks when trading starts later today. That’s why the ASX 200 overnight futures market was down more than 30 points at 8 am Gold futures for December delivery dropped 3.3% to settle at $US1269.70 an ounce in New York, the biggest fall since December 2013.
On Monday, prices had closed at $US1312.70 an ounce.
Comex December silver lost $US1.09, or 5.8%, to settle at $US17.775 an ounce, with prices at their lowest finish since late June.
Comex December copper fell a more modest 2.5 cents, or 1.1%, to $US2.167 a pound. January platinum lost $US18.60, or 1.8%, to $US990.50 an ounce and December palladium dropped $US12.25, or 1.7%, to $US699.55 an ounce.
