At the close of trading on 27/6, the spot price of gold fell 53 USD to 3,272 USD per ounce, its lowest level in a month. For the week, gold prices declined 2.8%, marking the second consecutive week of losses.
The US announcement of a trade agreement with China eased safe-haven demand. In the Middle East, the ceasefire between Iran and Israel held despite a few incidents on the first day.
"Investors are taking profits as geopolitical tensions ease," said Daniel Pavilonis, senior market strategist at RJO Futures.
 |
World gold prices fell sharply on 27/6. Chart: Kitco |
In the US, new data revealed a sharp drop in consumer spending in May as pre-tariff buying subsided. Inflation remained under control, with the personal consumption expenditures (PCE) price index rising 2.7% in May.
Investors now anticipate the Federal Reserve (Fed) will cut interest rates starting in September. Lower interest rates tend to benefit gold, as it doesn't offer a fixed return.
On the US stock market, both the S&P 500 and Nasdaq Composite hit new highs on 27/6. The S&P 500 rose 0.5% to 6,173 points, briefly touching 6,187 points during the session. The Nasdaq Composite saw a similar increase, reaching 20,273 points. The Dow Jones Industrial Average (DJIA) closed at 43,819 points, a 1% gain.
Market optimism stemmed from the potential for US trade agreements with its partners, and the latest economic data reinforced expectations of a Fed rate cut. News of the US halting trade talks with Canada had little impact on the 27/6 rally.
"The market is very buoyant. Investors are riding this momentum and looking for breakouts. Nobody wants to be left out," said Chuck Carlson, CEO of Horizon Investment Services.
Among the 11 sectors in the S&P 500, consumer discretionary stocks saw the largest gains. Shares of chipmakers Micron and Nvidia also rose, with Nvidia's market capitalization nearing 4 trillion USD. Nike stock surged 15.2% after the company projected a smaller-than-expected decline in current-quarter revenue.
Ha Thu (according to Reuters, Kitco)
