Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold slid 0.4% to close under $1,938 as worries about the global recovery triggered a sharp selloff on Wall Street, prompting traders to cover losses by liquidating other assets.

The US services sector slowed in August, according to the ISM non-manufacturing index, as the resurgent coronavirus pandemic and evaporating fiscal stimulus weighed on the economy. While still expanding, the sector is bringing back fewer employees than pre-pandemic. Services companies like hotels, restaurants, banks, airlines, and retailers employ around two-thirds of working Americans.

Services in the Eurozone are faring even worse, with the IHS Markit non-manufacturing index registering barely above contraction in August.

Meanwhile, filings for first time unemployment benefits fell below 900,000 last week, ostensibly marking progress in the labor market. But the decrease of more than 200,000 from the week before was attributed primarily to changes in the methodology of accounting for seasonal fluctuations.

Wall Street tumbled on concerns that the global recovery may be slowing. The losses were led by high-flying technology blue chips like Apple, Amazon, and Facebook, prompting the tech-heavy Nasdaq to drop 5% from its recent new high. The Dow lost 2.8% and the S&P 500 3.5%.

One of the most liquid assets in most portfolios, gold was widely sold to cover losses in equities despite a falling dollar and lower bond yields, both of which typically support the metal.

The other precious metals were also mostly lower, with silver and platinum falling 1.9% and 1.6%, respectively, while palladium added 2.4%.

At the Comex close: December gold slid $6.90 to $1,937.80; December silver fell 52 cents to $26.88; October platinum 14.50 to $889.60; and December palladium picked up $54.10 to $2,321.60 an ounce.