Gold hits near three-week low on stronger US dollar; Fed symposium in focus
Spot gold was down 0.1 per cent at US$3,312.79 per ounce, as at 8.35 am, after reaching its lowest level since Aug 1.
US gold futures for December delivery fell 0.1 per cent to US$3,355.20.
The US dollar index climbed to its highest level in more than a week, making gold less affordable for buyers using other currencies.
Fed chair Jerome Powell's speech at the Jackson Hole symposium from Aug 21 to 23 is the main focus, with investors watching for any pushback against market pricing of a rate cut next month.
Minutes of the Fed's July meeting, due later in the day, are anticipated to offer further insights into the central bank's policy stance.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Sign Up
Sign Up
Interest rate futures point to two rate cuts of 25 basis points each this year, with the first one expected in September.
Gold typically performs well in a low-interest-rate environment and amid heightened uncertainties.
US President Donald Trump ruled out deploying ground troops to Ukraine on Tuesday but suggested air support could be part of a deal to end Russia's war in the region.
Ukrainian President Volodymyr Zelensky hailed the White House talks as a 'major step forward' towards ending Europe's deadliest conflict in 80 years and setting up a trilateral meeting with Russian President Vladimir Putin and Trump.
Elsewhere, spot silver held steady at US$37.35 per ounce, platinum gained 0.3 per cent to US$1,309.35, and palladium was down 0.4 per cent to US$1,110.50. REUTERS
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
CNA
16 minutes ago
- CNA
Analysis:US tech-stock stumble shows vulnerability in AI trade
NEW YORK :U.S. technology shares are showing signs of vulnerability after a massive run, which has some investors pointing to overdone AI-driven gains while funds have taken steps to position away from the high-flying sector. Investors are looking to de-risk portfolios or lock in profits during a seasonally difficult period for stocks. Friday's looming speech by Federal Reserve Chair Jerome Powell at the annual Jackson Hole symposium is creating caution, investors said, with the potential for volatility if his comments fail to meet growing market expectations that the central bank is poised to cut interest rates. "When you have overcrowding and you have had such strong performance, it doesn't take much to see an unwind of that," said Keith Lerner, co-chief investment officer at Truist Advisory Services. "At the same time this week, everyone is waiting for the Fed, and there is repositioning ahead of that." The heavyweight S&P 500 tech sector fell sharply for a second consecutive session on Wednesday, putting its decline on the week at about 2.5 per cent, while the tech-heavy Nasdaq Composite was off about 2 per cent for the week. Shares of some highflyers, including Nvidia Corp and Palantir Technologies, were getting hit particularly hard. The pullback comes after a huge rally in which the tech sector soared over 50 per cent through last week since the market's low for the year in April. That easily topped the 29 per cent gain of the broader S&P 500 during that period and drove up valuations of tech stocks to lofty levels. Investors cited wariness about the artificial intelligence trade, which has been a key driver of tech stocks and the broader market as indexes have soared to record highs this year. Shares of Nvidia, the semiconductor giant that has symbolized the AI trade, have gained about 30 per cent this year while shares of AI-focused data and analytics firm Palantir have roughly doubled year-to-date. Indeed, the tech sector's price-to-earnings ratio recently reached about 30 times expected earnings for the next 12 months, its highest level in a year, according to LSEG Datastream, while tech's share of the overall S&P 500's market value is nearly its highest since 2000. Recent cautionary signs included a study from researchers at the Massachusetts Institute of Technology that found that 95 per cent of organizations are getting no return on AI investments, as well as comments by OpenAI CEO Sam Altman, who told tech news website the Verge last week that investors may be getting overexcited about AI. Since last week, some AI-linked shares have pulled back sharply: Nvidia has dropped about 5 per cent while shares of Palantir have slumped some 16 per cent. In Europe, stocks of so-called AI adopters have been under pressure over concerns over how powerful new AI models could disrupt the software sector. Still, some investors said, the caution is unlikely to be a sign that enthusiasm over AI is fizzling. 'These are price corrections," said Andrew Almeida, director of investments at financial planning network XYPN. "But if you look at the big picture, it's clear that more people will be investing more dollars in AI infrastructure. This is certainly not a 'reckoning' with the AI theme." JACKSON HOLE SEEN AS CRITICAL Investors also could be paring back their stock exposure during a traditionally rocky period for equities. August and September rank as the worst-performing months on average for the S&P 500 over the past 35 years, according to the Stock Trader's Almanac. "Valuations were stretched, these names have not taken a breather, and we're going into a tougher season for stocks," said King Lip, chief strategist at Baker Avenue Wealth Management. Other sectors such as consumer staples, healthcare and financials were up on the week, while relative strength for the equal-weight S&P 500 signaled to some investors a possible start of broadening of gains beyond the massive tech stocks that have led indexes higher. Powell's upcoming speech comes as Fed fund futures on Wednesday were indicating an 84 per cent chance that the central bank will cut rates at its next meeting on September 16-17. Investors will be watching to see if Powell gives any indication that the central bank is on track for such a move or if he pushes back on the market's expectation for easing, which could spark volatility. Tech stocks tend to carry higher valuations which could make them sensitive to higher-than-expected interest rates going forward. "There are a lot of people who have overweighted tech, and it has worked for them," said Chuck Carlson, chief executive officer at Horizon Investment Services.
International Business Times
an hour ago
- International Business Times
Global Stocks Turn Cautious as Nasdaq Slides, Nikkei Declines, and Fed Outlook Weighs on Markets
Global markets were mixed Wednesday. Stocks Big tech shares sank on Wall Street, dragging the Nasdaq and S&P 500 lower, even as the Dow hovered near record levels. In Asia, sentiment soured and Japan's Nikkei was off from recent highs, while regional action was mostly mixed ahead of major Fed signals and Nvidia's results. Freepik Tech Stocks Take a Hit U.S. technology shares fell on Tuesday, leading the Nasdaq to drop 1.5% in its sharpest decline in weeks. The S&P 500 fell 0.6 percent as well, even after the Dow Jones Industrial Average reached an intraday record. Analysts described the shift as a reshuffling of the market rather than a response to significant new developments. Worries about artificial intelligence (AI) weighed as well. Comments from OpenAI's Sam Altman about inevitable "bubbles" in the field and research questioning AI's profitability and job impact also dampened sentiment. The next earnings report from chipmaker NVIDIA is on deck, and investors are nervous about whether the recent AI-driven momentum is sustainable. Attention Turns to the Federal Reserve Attention has now shifted to the Federal Reserve's Jackson Hole symposium later this week. Although some traders point to the Fed's uncertainty as a driver of Tuesday's volatility, pricing for a September rate cut remains steady, with markets showing more than an 80% chance of a quarter-point reduction. U.S. housing data gave a conflicting view, mixed picture, with starts climbing in July but building permits slipping to their lowest in five years. Treasury yields stayed, and the dollar edged higher while investors awaited for the release of Fed meeting minutes. Global Markets React Weakness in technology stocks also spread overseas. The Japanese Nikkei fell by 1.5%, and the South Korean Kospi declined 0.7%. Chinese stocks, on the other hand, performed better as the Shanghai Composite leapt to its highest in more than a decade amid hopes of government stimulus and portfolio rebalancing. European markets were somewhat muted after a short-lived lift on optimism about Ukraine talks. Inflation readings were mixed, with eurozone data meeting the forecasts and a hotter figure in the U.K. seen as warped by airfare costs. But European defense stocks dropped sharply. Oil, Currencies, and Commodities Oil prices slipped as markets weighed the potential for easing tensions in Ukraine that could avert a disruption of Russian crude exports. Brent fell 0.8% to $66.07 a barrel, and U.S. crude dropped 0.9% to $62.88. The euro advanced modestly against the dollar, and the yen strengthened slightly. Gold rose 0.3%, to $3,339.54 an ounce, and was getting a safe-haven bid. Bitcoin and ether also fell, following the broader mood of risk.
International Business Times
an hour ago
- International Business Times
White House Joins TikTok, Trump Bets Big on App Despite China Concerns
The White House is now officially on TikTok, in a move that's sure to make the weird times we live in feel even weirder and more Orwellian. The new account, @whitehouse, debuted Tuesday evening with a brief video of President Donald Trump proclaiming, "I am your voice." The caption said, "America, we are BACK! What's up, TikTok?" X TikTok, owned by the China-based company ByteDance, has more than 170 million users in the United States. Trump has embraced the platform, crediting it for helping him win support among younger voters during his 2024 race against Democrat Kamala Harris. His campaign handle, @realdonaldtrump, already has over 15 million followers. White House press secretary Karoline Leavitt said the administration plans to use the platform aggressively. "The Trump administration," she said, "is eager to keep the American people, through as many audiences as possible, informed of President Trump's historic successes achieved despite a decade of partisan obstruction by the," etc. We are thrilled to be able to capitalize on the campaign's momentum." The decision comes amid fierce political debate in Washington. Lawmakers and intelligence officials have also warned that TikTok's ownership could provide the Chinese government with access to Americans' sensitive data. Previous assessments have indicated that the app could be used to shape American political opinion. By 2024, Congress had passed a law that mandated the Chinese app either divest itself of its U.S. assets or face a nationwide ban by Jan. 19, 2025. ByteDance has yet to finalize a deal, but Trump, who resumed office in January, has raised the deadline several times — first in April and, later, to June and now September 17. These extensions have prompted some lawmakers to push back, accusing the administration of prioritizing politics over national security. Critics say the White House is papering over the risks associated with Chinese ownership of the platform; Trump's allies counter that the app has grown too vital to political communication to cast away. Despite the controversy, Trump remains committed to the multi-platform approach. Next to TikTok, he is an active poster on Truth Social, the social media network he created, and, less frequently, X, once known as Twitter. The White House's official TikTok would feature Trump's policy accomplishments and push his administration's messaging in a more casual and fun format that hopes to connect with the large pool of younger audiences who use the app. With a deadline for TikTok's divestment still less than a week away and a ban on the app's U.S. business looming in order to "address national security threats," the future of the app in the U.S. remains up in the air. For the moment, the White House is counting on the app as a potent tool for expanding its reach, even as the political and security issues hover overhead.
