Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold surged 1%, closing at a six-year high near $1,552, as stocks and Treasury yields fell on trade worries, boosting demand for alternative assets. Silver soared nearly 3% to close at $18.15, the highest level in more than two years.

All three major US stock indexes fell, with the Dow losing 0.5% while the S&P 500 and Nasdaq dropped 0.3%, as Monday's hopes faded for quick resolution to the US-China trade war.

President Trump declared yesterday that China had reached out to make a trade deal, spurring optimism and risk appetite. But the claim was disputed today by China's foreign ministry, raising doubts about likely progress and causing investors to shift away from risk.

Last week, both sides escalated the conflict by imposing additional tariffs. Morgan Stanley's chief economist warned today that the global economy will tip into recession within nine months if the latest round of tariff increases stays in effect for four to six months.

Trade disputes are taking a serious toll on Germany, where GDP contracted in Q2 due to weaker exports. The IFO survey on business sentiment is expected to drop to a seven-year low this month. Germany's is the biggest and most dynamic economy in the Eurozone.

Benchmark 10-year US Treasury yields fell sharply as investors sought safe havens, causing the yield curve to invert by the most since 2007. An inverted yield curve occurs when short-term interest rates exceed long-term rates, signaling pessimism about the long-term outlook. It often predicts recessions.

The other precious metals were also higher, with palladium and platinum adding 1.2% and 0.4%, respectively.

At the Comex close: December gold gained $14.60 to $1,551.80; September silver rose 51 cents to $18.15; October platinum climbed $10.40 to $868.20; and September palladium added $6 to $1,478.30 an ounce.