As the speculation is higher on the Fed’s stimulus tapering, precious metals advanced to a great extent. Whereas gold climbed 0.3 percent to $1,244.19 an ounce at 8:38 a.m. in London, silver gained 0.5 percent. According to observers investors are still weighing the outlook for Federal Reserve stimulus and hope this continues.
Amidst the news that crude prices are up after a several months’ low, Asia’s benchmark equity index slipped and European stocks were little changed. The major contribution in lower performance of benchmarks in Asian trade is attributed to the low performance of the industrial production in China as it trailed estimates.
Crude prices are moving upward as oil added 0.4 percent in New York. Whereas there was a slight growth for the Stoxx Europe 600 Index that rose 0.1 percent, the MSCI Asia Pacific Index lost 0.1 percent. Similarly, futures on the Standard & Poor’s 500 Index were little changed on comparatively positive trading.
Better prospects are visible in oil as its prices are climbing. It reached to the highest level since Oct. 29 in New York. A major development is that U.S. crude stockpiles probably shrank by 3 million barrels last week; it has been a major reason behind the lower prices in WTI crude prices.
The major setback for gold came earlier the last month when it was reported that the spot gold price took its worst monthly tumble in November for 35 years. Throughout the year there has been a consistent decline in the gold prices. According to market observers a price fall of such magnitude hasn’t been seen in November since 1978.
In fact, gold’s topsy-turvy year rolls on because of the surging stock market. However, some observers believe that the price of gold has soured since the turn of the century as it is still being considered both a hedge against inflation and a safe bet in challenging economic climes. Though this year has not seen a lot of upward movement, ten years ago it was a hit investment.
For instance, prices rose 872 percent between 1999; however, there was a decline in the last year when gold clocked up an annual fall. It is observable that gold has been hard hit this year; it may be because the U.S. Federal Reserve has brought in massive stimulus program. Another reason cited for gold’s weakness is that the strength in equities has gone up.
To contact the reporter of this story: Jonathan Millet at email@example.com