Gold is resisting positive market sentiment -- Commerzbank

(Kitco News) Gold is trading very close to the $1,800 an ounce level this week and is resisting positive market sentiment despite a concerning increase in the number of coronavirus cases, according to Commerzbank. “The gold price climbed to as high as $1,787 per troy ounce this morning and thus came within $3 of the eight-year high it recorded a week ago. The gold future in New York almost regained the $1,800 mark that it had briefly exceeded last week. Gold is thus resisting the positive market sentiment that is reflected in significantly rising stock markets,” writes the banks’ energy, agriculture, precious metals analyst Carsten Fritsch. “The Nasdaq technology index for example posted a new all-time high yesterday. The S&P 500 is again nearing its post-corona high from four weeks ago … By contrast, the fact that the number of new corona cases is still rising in the U.S. at the same time – yesterday it reached new record highs in 16 states – does not (yet) appear to be playing any major role on the market.” The rising number of coronavirus cases in India could potentially be a concern for the already very weak gold demand out of Asia, Fritsch adds. “The spread of the corona pandemic in India, which now has the third-highest number of cases worldwide, is also grounds for concern. This is likely to preclude any recovery of gold demand there in the near future. The strict curfew in India means that hardly any gold has been sold or imported there for months (see also last Friday’s Commodities Daily). Demand is therefore highly dependent on whether investors are in buying mood – which they have been continuously so far.”