Gold Sees Some Profit Taking As Risk Appetite Upticks

By Paul Ploumis (ScrapMonster Author)

March 02, 2016 02:44:39 AM

(Kitco News) - Gold saw some profit-taking pressure set in Tuesday, following recent gains. An improved risk appetite on this day also worked against the safe-haven metal. Still, some profit taking and chart consolidation is not unhealthy for a market like gold, which is in a firm near-term price uptrend. April Comex gold was last down $3.10 at $1,231.10 an ounce. May Comex silver was last down $0.143 at $14.775 an ounce.

There was a heavy slate of U.S. economic data due for release Tuesday, including the U.S. manufacturing PMI, construction spending, the ISM manufacturing report on business, and domestic auto industry sales. The data was a mixed bag but was upbeat, overall. That helped to boost the U.S. stock market and the U.S. dollar index, and put some downside pressure on gold.

Global stock markets were also mostly higher Tuesday, despite some dour economic news coming out of China. China’s manufacturing purchasing managers’ index (PMI) came in at 49.0 in February--the lowest level in over four years.  A reading of 49.4 was expected. A figure below 50.0 suggests contraction in the sector. The downbeat China PMI report led to further speculation that China’s central bank will implement further monetary policy easing moves, and that was actually a bullish element for Asian equities Tuesday. China’s central bank on Monday lowered its reserve requirement ratio for banks.

Courtesy: Kitco News