Gold retreat as investors demand for safety drop
Investors sought risky investments by the start of today's trading session as the absence of major news on the economic calendar is forcing investors to lead financial markets based on pure desires. Investors await the release of Bank of England's Minutes in order to sketch a better outlook for the Royal country and derive a full outlook for the European continent.
The released news this week spread pessimism among investors, forcing stocks to fluctuate and mostly close on red, due to the disappointing data presented by the U.S. housing market, along with skeptical performance of major financial institutions in the world regarding their performance throughout the past three months.
Additional institutions will release their results today, where Hudson City Bancorp, Morgan Stanley, Wells Fargo & Co, eBay Inc, Coca Cola Co, US Bancorp, M&T Bank and Northern Trust Corp, are among several institutions that will present earnings reports before markets, accordingly, causing severe volatility in trading for the remainder of today.
Investors intensified risk appetite by directing their investments to high yielding assets and risky investments, where Europe's future indices are pointing to a higher start for today's trading session. Shifting to high yielding assets caused the European common currency to gain enough momentum and rise against the single currency of the U.S. where it rose by nearly 0.2 percent in the Asian session.
Gold hectic demand levels are shifting back, where the past period witnessed a massive sell outs to the 16-nation currency as investors sought safe investments, causing gold to hit historic highs and nearing $1250 an ounce, currently, investors are shifting back to sell gold and decrease their risk aversion, causing gold to drop as spurring demand for safety got reduced.
The dollar fell against most of its counterparts, where the U.S. dollar index, a gauge of the dollar's performance against six currencies including the Euro, Pound and Yen, fell on the daily basis to trade at 82.62, compared with the opening levels of 82.73.
Gold typically move in an inverse relationship with the Dollar, but the drop in the value of the dollar failed to extend yesterday's rise for gold, where Gold struck a high of $1192.10 an ounce, and a low of $1188.05 an ounce before dropping on the daily scale to trade at $1190.12 an ounce, from the opening levels of $1191.75.
As for other metals, Silver traded at the same opening levels set for today at $17.67 where it reached a high of $17.78 and a low of $17.61, meanwhile Platinum, which is the world's most expensive metal, dropped so far in today's trading by $4.0 or reaching $1507.0 an ounce. Meanwhile, Palladium inclined where the metal shed $2.0 in today's trading session where it's currently trading at $446.00 an ounce.
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