In sharp contrast to the global stock markets, gold and silver had dipped sharply during Tuesday’s trading as Vladimir Putin eases the geopolitical tension in Russia and Ukraine. The markets have interpreted a recent speech of his, as suggesting there will be no military action in the region.
This interpretation has switched market sentiment from risk-off to risk-on, as traders and investors rush to reallocate their capital to the stock markets. Gold futures (April 14 delivery) are currently trading at 1,3527.20, a 1.15% discount to their opening price and just ahead of key support at 1,354.20. Silver futures (May 14 delivery) have taken an even bigger hit, currently trading at 20.807, a 2.20% discount to the day’s open and the precious metal’s lowest price in a week.
If the risk-on sentiment holds firm, gold and silver could take further hits as the week goes on. With both the precious metals hovering around key levels, a close below would likely trigger a stop-fueled sell off that could contribute to their devaluation.**relatedarticle**
Elsewhere, natural gas futures (April 14 delivery) are also suffering. The fuel had a rose throughout the day on Monday, as cold weather swept across much of the US. During Tuesday however, forecast for mild weather have pared Monday’s gains. The contracts currently stand at a 1.34% decline for the day, trading for 4.474.
Crude oil futures (May 14 delivery) have benefited from a number of positive data releases on Tuesday, with headline building permits and the slightly less impactful building permits (MoM) coming in at 1.018M and 7.7% respectively, versus forecasts of 0.960M and 7.7%. Traders will look to the American Petroleum Institute’s weekly crude oil stock report at the U.S. market close to gauge supply conditions, but as things stand, the contracts are trading at a 1.02% premium to the day’s open, currently 98.60.
Finally, copper has brought back some of Monday’s losses, also a benefactor of Putin’s remarks. The industrial metal is currently trading at 2.955, representing a small gain of 0.09%.
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