Precious metals gained ground broadly as crude oil plunged more than 7% amid reports of ongoing negotiations between Iran and the United States to resolve an eight-month conflict. Bullion investors face headwinds from aggressive monetary policy, with markets pricing in a high likelihood of a December rate hike from the Federal Reserve alongside tightening steps by European peers. Meanwhile, U.S. midterm election developments are being monitored for clues on future fiscal direction.
Key points
Global interest rate increases continue to challenge bullion by boosting the opportunity…: Global interest rate increases continue to challenge bullion by boosting the opportunity cost of non-yielding assets.
European central banks remain hawkish, with the Bank of England expected to lift benchmar…: European central banks remain hawkish, with the Bank of England expected to lift benchmark rates to 4.0%.
Across other precious metals, spot silver, platinum, and palladium each recorded modest p…: Across other precious metals, spot silver, platinum, and palladium each recorded modest price increases.
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Fundamentals
Spot gold rose 0.3% to $3,960.80 per ounce by 0032 GMT, extending gains after rebounding from a one-year low hit on Friday.US gold futures for December delivery steadied at $3,970.80.
Oil prices fell more than 7% on Monday as Tehran said contacts between Iran and the United States to end their eight-month war were continuing after days of Iranian talks with Qatari mediators ended with altered proposals but no breakthrough.
US manufacturing activity picked up in October amid strong domestic demand, keeping inflation at the factory gate elevated.
Markets are now focused on the US midterm elections for clues on the fiscal policy outlook and broader investor sentiment.
Traders currently see a 73% chance that the Federal Reserve will raise rates in December, according to CME's FedWatch tool.
Higher interest rates increase the opportunity cost of holding non-yielding bullion, reducing its appeal to investors.
The Bank of England is expected to raise rates on Thursday to combat inflation pressure from elevated energy costs, with economists polled by Reuters expecting it to raise bank rate to 4.0% from 3.75%.
A sharp single-day rally of over 7% on November 2 pushed the energy conglomerate onto a technical momentum radar. The surge propelled the stock into a selective screen of eight Nifty 500 companies showing strengthening price action. Market participants track these technical indicators to gauge underlying trend strength and spot early signs of sustained buying pressure.
Regional market sentiment split as technology sector concerns collided with fresh monetary policy tightening across the Pacific. Investors faced headwinds stemming directly from guidance shared by the consumer electronics giant. Meanwhile, elevated borrowing costs introduced by central bankers signaled sustained pressure on broader economic growth.
Market participants observed a downward shift in the electronics component maker's equity valuation during the latest session. Analysts and investors are closely monitoring the enterprise as trading pressures emerge on the exchange. The contraction impacts overall share performance for the current trading day.