Gold futures staged a modest rebound early Tuesday, with the climb partly backed by a softening dollar that has provided some short-term lift to bullion that’s been trading near the year’s lows.
December gold GCZ8, +0.43% was up $6, or 0.5%, at $1,223.70 an ounce, after the yellow metal finished lower in the previous session.
September silver SIU8, +0.93% meanwhile, added 14 cents, or 0.9%, to $15.485 an ounce. more than erasing its Monday loss.
A popular metals exchange-traded fund, the SPDR Gold Trust GLD, -0.51% was firmer in premarket action after it lost 0.5% to end Monday trade, while the comparable silver ETF, the iShares Silver Trust SLV, -0.69% looked to recover Monday’s loss.
The precious metal rebound coincides most closely with a downturn for the U.S. dollar, as measured by the ICE U.S. Dollar Index DXY, -0.28% which was off 0.3% early Tuesday at 95.11. A stronger dollar can make purchasing dollar-pegged metals more attractive to buyers using other currencies.
The modest moves higher for commodities come even as assets perceived as risky were also climbing. Gold is typically considered a haven asset that moves inversely to equities. Futures for the Dow Jones Industrial Average YMU8, +0.33% DJIA, +0.16% and those for the S&P 500 ESU8, +0.22% SPX, +0.35% were on track to open higher Tuesday, extending Monday’s advance.
Meanwhile, global trade policy has continued to be a persistent concern that has thus far run in the background, intermittently knocking equity markets around and driving buying in bonds and the dollar. However, tariff conflicts between the U.S. and China have provided a more outsize boost to the dollar, weighing on the yellow metal, market participants said.
Read: Here’s what may be eroding gold’s traditional haven status
“I’m beginning to wonder if the bearish action in China is affecting the gold market. The Chinese have been big buyers of gold. The Shanghai index is down 24% from its recent highs,” wrote Stephen Todd, an independent market analyst in a Tuesday research note.
The Shanghai Composite Index SHCOMP, +2.74% is down roughly 16% so far this year and about 21% from its peak in late January, according to FactSet data. Over the weekend, President Donald Trump tweeted that “tariffs are working big time” and earlier cited declining Chinese stocks as evidence of their impact.
Looking ahead, investors await a reading of employment, a report on job openings in June is due at 10 a.m. Eastern Time, followed by data on the state of consumer credit for June, set to be released at 3 p.m.
In other metals, September copper HGU8, +1.08% added 2 cents, or 0.8%, to $2.754 a pound. Because of its use as an industrial metal, copper has been particularly influenced by vacillating trade-war concerns.
October platinum PLV8, +1.48% advanced by $11.70, or 1.4%, at $838 an ounce, while September palladium PAU8, +0.90% rose $5.70, or 0.6%, to reach $909.30 an ounce.
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