August 26, 2019 / 2:04 AM / 2 months ago

PRECIOUS-Gold touches over 6-yr peak as risk-off appetite stoked

Aug 26 (Reuters) - Gold prices jumped to a fresh six-year high on Monday as the announcement of new tariffs in the escalating Sino-U.S. trade war sent equity markets tumbling, and investors rushing for safe-have assets.

FUNDAMENTALS

* Spot gold jumped 1.2% to $1,544 per ounce as of 0141 GMT, having earlier touched $1,554.56 an ounce, its highest since April 2013.

* U.S. gold futures were up 1.1% at $1,554.90 an ounce.

* On Friday, U.S. President Donald Trump announced a 5% additional duty on $550 billion in targeted Chinese goods, hours after China unveiled retaliatory tariffs on $75 billion worth of U.S. products.

* This caused U.S. stocks to dive on Friday: with the Nasdaq Composite down 3%, and the S&P 500 down 2.6%.

* On Monday, Japan’s Nikkei and MSCI’s broadest index of Asia-Pacific shares outside Japan fell sharply.

* The markets are fully priced for a quarter-point cut in rates next month, and over 100 basis points of easing by the end of next year.

* Yields on 10-year Treasury notes dived from a top of 1.66% on Friday, leaving them almost matching two-year yields.

* The dollar index, which measures the greenback’s value against a basket of six major currencies, slid 0.5% on Friday, and was hovering close to that level.

* Traders are looking at the Group of Seven summit, where Trump said he wished he had raised tariffs on Chinese goods even higher last week.

* SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.58% to 859.83 tonnes on Friday.

* Hedge funds and money managers increased their bullish stance in COMEX gold and upped net long positions in silver contracts in the week to Aug. 20, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.

* Last week, most Asian hubs experienced a slight uptick in physical gold demand as consumers took advantage of a retreat in prices.

DATA AHEAD (GMT)

* 0800 Germany Ifo Business Climate New Aug

* 0800 Germany Ifo Curr Conditions New Aug

* 0800 Germany Ifo Expectations New Aug

* 1230 US Durable Goods July (Reporting by Harshith Aranya in Bengaluru)

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