Gold and silver futures settled higher Wednesday for the first time in three sessions, inversely tracking a fall in stocks and other assets that tend to gain in times of growing appetite for risk.
Gold for June delivery on Comex GCM19, +0.40% rose $3.90, or 0.3%, to settle at $1,281 an ounce. August gold GCQ19, +0.40% which now trades on higher volume, rose $3.80, or 0.3%, to finish at $1,286.30.
July silver SIN19, +0.23% gained 9.1 cents, or 0.6%, to $14.411 an ounce. On Tuesday, prices logged their lowest settlement of 2019 so far.
Gold trades roughly 0.4% lower month to date. Silver, tagged with both investing and industrial use, has exhibited greater volatility around the U.S.-China trade discussions; it added 1.2% for last week, though its monthly drop so far stands at about 3.7%.
The yellow metal is building on last week's gain with the latest move up "due to robust Indian demand, stocks falling due to fears of a protracted U.S.-China trade war and poor economic data from the U.S., EU and globally," Mark O'Byrne, research director at GoldCore, told MarketWatch. "Heightened political and geopolitical uncertainty is also supporting gold."
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U.S. stocks headed lower on Wall Street Wednesday as gold futures settled. Worries about trade tensions and the outlook for global growth weighed on equity markets and sparked continued buying interest in government bonds.
U.S.-China trade tensions remained a factor, analysts said, after Chinese state media reports underlined the country's scope to use rare-earth minerals, used in the production of everyday devices, such as mobile phones, computer memory chips and rechargeable batteries, as an economic weapon.
See: Shares of Chinese Australian rare-earth companies soar amid China threat over exports
Metals gained even as the U.S. dollar DXY, -0.04% ticked higher Wednesday relative to its peers, a break in the typically inverse relationship between the U.S. unit and precious metals priced in dollars. The 10-year Treasury TMUBMUSD10Y, -1.15% yield continued to trade in the red as bond prices gained, with the yield at its lowest since October 2017.
Gold and other commodities priced in dollars can typically be hurt by a firmer greenback, making them more expensive to users of other currencies, and vice versa. And, lower yields on bonds can be beneficial to assets like gold by reducing the opportunity cost of holding nonyielding metals.
Among other metals, July copper HGN19, -0.30% traded at $2.664 a pound, down 1.2% and July platinum PLN19, -0.23% shed 0.7% to $791.70 an ounce.
June palladium PAM19, +1.29% added 0.7% to $1,348.60 an ounce, while the most-active September palladium contract PAU19, -0.27% settled at $1,343.90, up 0.5%.
The SPDR Gold Shares exchange-traded fund GLD, +0.68% tacked on less than 0.1%.