(Bloomberg) --Gold is beating U.S. stocks this year as a war of words between President Donald Trump and North Korea, along with a weaker dollar, boosts demand for haven assets.
Bullion has climbed 11 percent in 2017, overtaking the S&P 500 index of leading U.S. stocks as Japan and South Korea warned the North Korean dictatorship it faces a strong response if it follows through on threats to launch a missile toward the U.S. territory of Guam. Gold rose 0.2 percent to $1,279.20 an ounce by 11 a.m. in London after touching the highest since June 14.
There’s “still a risk that it may fail at $1,295 once again,” Ole Hansen, head of commodity strategy at Saxo Bank A/S, said by email. “However, a break would force funds to step in considering the relative low exposure they currently hold.”
Gold hit around $1,296 an ounce in April and June before falling back.
U.S./N. Korea
- NOTE: Trump goes with gut to shake up strategy toward North Korea
- NOTE: South Korea warns North Korea against launching missile at Guam
- NOTE: Secretary of State Rex Tillerson tried to ease concerns that the U.S. was heading toward military confrontation with North Korea after President Donald Trump rattled global markets with his warning that he could unleash “fire and fury” against Kim Jong Un’s regime
- “Prices received a fillip from a rise in geopolitical tensions surrounding North Korea, with both Kim Jong Un and President Trump adopting a more aggressive stance,” said John Sharma, an economist at National Australia Bank
Precious Metals
- Silver +0.7% to $17.0734/oz after +3% on Wednesday
Heading for highest close since June 9 - Platinum +0.2 at $977.13/oz
Metal rallied for 10 days, longest run since 2012 - Palladium +1% to $899.94/oz
To contact the reporters on this story: Eddie van der Walt in London at [email protected] ;Ranjeetha Pakiam in Singapore at [email protected] To contact the editors responsible for this story: Lynn Thomasson at [email protected] Tony Barrett
