Gold prices dip as stocks boost risk appetite

Spot gold hovering near 100-day moving average

Gold fell yesterday, retreating from last week’s 2-1/2 month peak as rallying global stock markets pointed to improved investor appetite for risk.

Spot gold was down 0.2 per cent at $1,223.74 (Dh4,495) an ounce at 1042 GMT, having hit a 2-1/2-month peak last week at $1,233.26 per ounce. US gold futures fell 0.2 per cent at $1,226.60 an ounce.

European shares gained ground after Moody’s kept Italy’s sovereign rating intact, with the market also taking cues from rallies in Asia, after China’s promise to provide stimulus to stabilise its economy and offset the impact of US tariffs.

However, losses for gold were limited, with a weakening dollar and prices still hovering around the 100-day moving average, around $1,224, a key technical level, analysts said.

“We are still in a lateral phase between $1,220 and $1,230.

I wouldn’t be worried about the low correction this morning as long as it is keeping positive momentum,” ActivTrades chief analyst Carlo Alberto De Casa said.

Geopolitical concerns, including tensions between Saudi Arabia and the West over the disappearance of journalist Jamal Khashoggi, and developments related to Brexit were seen keeping some investors favourably disposed towards gold.