Gold soars on elec­tion un­cer­tainty


Gold surged the most since the Brexit vote as traders plowed back into haven as­sets on re­ports show­ing sur­prise vic­to­ries for Repub­li­can Don­ald Trump in states crit­i­cal to his White House hopes.

Bul­lion jumped above $1,300 an ounce as early re­sults raised the pos­si­bil­ity that Trump may pre­vail over Demo­cratic can­di­date Hil­lary Clin­ton in the race for the pres­i­dency, throw­ing global mar­kets into tur­moil. Gold soared along with other havens in­clud­ing the yen while oil and eq­ui­ties tum­bled.

In­vestors are flee­ing riskier as­sets as pro­jec­tions showed Trump vic­to­ries in Florida, Ohio and North Carolina, states that he needs to have a path to the White House.

Most polls showed Clin­ton ahead go­ing into the vote and the first four states to be called were in line with fore­casts. Gold prices soared as much as 8.1 per­cent fol­low­ing Bri­tain’s vote to leave the EU in June.

“Rightly or wrongly, a Trump vic­tory is seen by mar­kets as a ma­jor risk event,” said Ric Spooner, chief mar­ket strate­gist at CMC Mar­kets Asia Pa­cific Pty in Syd­ney. “The size of the moves we’ve seen to­day in key mar­kets does point to the pos­si­bil­ity for fur­ther risk-off moves if a Trump vic­tory is con­firmed.”

Bul­lion for im­me­di­ate de­liv­ery jumped as much as 3.7 per­cent to $1,323.17 an ounce, the big­gest in­tra­day rally since the UK’s Brexit vote, ac­cord­ing to Bloomberg generic pric­ing. It traded at $1,318.34 at 11:54 a.m. in Sin­ga­pore, hav­ing re­bounded from an ear­lier loss of as much as 0.6 per­cent.

Trump was pro­jected to win Florida’s 29 elec­toral votes, an un­ex­pect­edly strong show­ing that po­ten­tially throws the bal­ance in the pres­i­den­tial race to Michi­gan and Wis­con­sin, key parts of Clin­ton’s Mid­west­ern elec­toral fire­wall. He was also on track to win Ohio, Florida and North Carolina, based on net­work pro­jec­tions. Clin­ton pulled out a vic­tory in Vir­ginia and Colorado — two states crit­i­cal to her chances — but Trump was com­pet­i­tive in an­other state she was count­ing on, New Hamp­shire.

“We are glued to our screens and try­ing to make out which way it is go­ing to be,” said Naeem As­lam, chief mar­ket an­a­lyst at Think Mar­kets UK Ltd. in London. “For us, keep­ing a close eye on gold, yen and peso are the main in­di­ca­tors, and af­ter ev­ery re­sult we are look­ing at them.”

Bul­lion has gy­rated in re­cent weeks as in­vestors tracked the cam­paign, which has dom­i­nated sen­ti­ment even as the Fed­eral Re­serve sig­nals that it’s set to raise in­ter­est rates. While a win for the Repub­li­can is largely seen as bullish for bul­lion be­cause his prom­ises to rene­go­ti­ate trade deals and curb im­mi­gra­tion may stoke in­sta­bil­ity, a Demo­crat vic­tory is seen as less tur­bu­lent. Odds of a US rate hike sank on Wed­nes­day as the US re­sults came in, bol­ster­ing the case for hold­ing gold.

Hedge funds piled into bul­lion a week be­fore Elec­tion Day amid bets that a Trump vic­tory would trig­ger a re­peat of last week’s sell­off that sent the S&P 500 In­dex of eq­ui­ties to its long­est slump since 1980. Clin­ton is seen as a con­ti­nu­ity can­di­date whose win would likely do lit­tle to change the Fed­eral Re­serve’s plan to raise US in­ter­est rates.


Vot­ers check in to cast their bal­lots dur­ing vot­ing in the 2016 pres­i­den­tial elec­tion in San Diego, Cal­i­for­nia on Tues­day.

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