Precious metals bullish as China’s Caixin PMI for July disappoints

The precious metals gold, silver, platinum and palladium were all up on Monday morning – Photo: Shutterstock

The precious metals gold, silver, platinum and palladium were in good shape on Monday morning, starting the week on a positive note. This was mainly boosted by the fact that Caixin’s China manufacturing PMI data for July was disappointing, falling from 51.7 to 50.4 and missing the forecast of 52. With China being a major producer and consumer of the most goods, this data is quite alarming, as a potential warning sign. for the recession, leading to greater demand for safe havens for precious metals.

Investors are also eagerly awaiting US ISM manufacturing data, which is due out later today. This will provide insight into whether the US Federal Reserve’s aggressive monetary tightening policy actually succeeded in pushing the US economy into recession.

Gold rose for the fourth consecutive session

In morning trade in London, spot gold rose 0.5% to $1,776 per troy ounce, up for the fourth consecutive session and approaching a one-month high. This followed recent US economic data showing a contraction in GDP for the second consecutive quarter, which pushed the US economy into a technical recession.

Silver rose 0.5% to $20.4 per troy ounce, also gaining for the fourth straight session, with the precious metal following in gold’s footsteps as usual. Investors were also relieved to see that the precious metal was still trading above the critical $20 per troy ounce level.

Yields on 10-year US Treasuries fell to 2.7%, down about 30 basis points in the past 10 days.

Platinum rose 1.3% to $908 a troy ounce, gradually recovering from a 22-month low seen 2 weeks ago as supply disruptions from Russia continued to plague the market. precious metal.

Palladium edged up 2.3% to $2,175 per troy ounce, following an increase in Chinese imports of Russian palladium, giving investors hope for some recovery in China’s auto sector.

Copper edged down 0.4% to $3.5 a pound on the back of disappointing factory data from China’s top consumer, which revealed economic activity in the country was still not up to par. height. However, the base metal has still gained more than 13% over the past two weeks.

Aluminum fell 1.6% to $2,457 a tonne, following alarming data from Chinese factories showing a drop in manufacturing activity in July.

Iron ore fell 0.4% to $117.5 a tonne but still rose more than 14% last week on China’s announcement of plans to centralize its sector iron ore.

The main things to know about metals today

Gold: Eldorado Gold announced an increase of around 20% in its operating costs in the second quarter of the year.

Iron ore: China’s new mining company, China Metals Resources Group, should have the potential to overtake Australian iron ore.

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Copper: A new coating of nano-copper has recently been designed, with superbug-fighting properties, killing approximately 99% of Staphylococcus aureus in approximately one hour.

Platinum: Zimbabwe recently increased taxes on platinum, as well as taxes on lithium, to support the economy.

Top things to know about mining stocks today

Glencore (GLEN) recently unveiled fairly mixed half-year production results.

Rio Tinto (RIOgb) received a “hold” rating from a consensus of analysts.

Antofagasta (ANTO) cited operational issues as well as droughts for the company, cutting its copper forecast for the rest of the financial year.

Anglo American (AALI) recently warned of a severe copper shortage in the coming days as new mines become increasingly difficult to build.

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