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What’s happening: Gold prices settled higher on Monday as markets continued monitoring trade tensions.
What happened: US Federal Reserve officials signalled that they were ready to cut interest rates once growth risks become clear.
Weakness in the US dollar lent further support to the yellow metal on Monday.
Why it matters: Gold prices have risen sharply this year after tariff announcements by US President Donald Trump. The yellow metal, which is considered a safe-haven asset during heightened geopolitical and financial concerns, surged to a record high above $3,500 an ounce last week.
Although China has rolled back retaliatory tariffs on some US imports, Beijing denied assertions made by Trump of ongoing talks. US Treasury Secretary Scott Bessent also said that he was not aware of any trade talks between Trump and China’s President Xi Jinping.
The US dollar moved lower across the board, lending support to gold prices, as investors awaited further news related to trade policy. The US dollar index, which measures the greenback’s performance versus a basket of major peers, fell around 0.7% to 99.01 on Monday.
Gold futures jumped 1.5% to close at $3,347.7 an ounce on Monday.
In other metals trading, silver settled at $33.005 per ounce and platinum settled higher at $995.2, while palladium closed at $950.30.
What to watch: Investors will continue monitoring announcements related to tariffs from the US and China.
Investors await the release of major economic reports this week, which would help investors gauge the impact of tariffs on economic growth. Data on US job openings will be released on Tuesday, while the Personal Consumption Expenditures report is scheduled for release on Wednesday. The much-awaited NFP report from the US will be in focus on Friday.
Context: Equity markets in Europe settled higher on Monday as investors assessed news related to tariffs.
Details: Global investor sentiment received a boost with some easing of trade tensions between the US and China, after the Asian nation announced the exemption of retaliatory tariffs on some US goods and the Trump administration signalled its willingness to cut tariffs on China.
Meanwhile, data released on Monday showed Spain’s unemployment rate rose to 11.36% in the first quarter, from 10.61% in the previous quarter. This marked the highest unemployment rate in a year. Retail sales in the country grew by 3.6% year-over-year in March, maintaining the pace recorded in the previous month.
Banca Generali’s gained more than 5% on Monday after Italy’s Mediobanca announced a €6.3 billion takeover offer for the company. Meanwhile, shares of Airbus rose more than 2.5% after the company finalised an agreement to buy key assets from Spirit AeroSystems in a bid to strengthen its aircraft production.
The STOXX Europe 600 Index added 0.53% to close at 523.19 on Monday, with all sectors closing in the positive zone. Automotive and banking stocks were among the top performers during the session.
London’s FTSE 100 gained 0.02% to 8,417.34 on Monday, while Germany’s DAX 40 and France’s CAC 40 added 0.13% and 0.50%, respectively.
What to watch: Investors await the release of data on economic sentiment (1300 UAE Time), consumer confidence (1300 UAE Time) and industrial sentiment (1300 UAE Time) from the Eurozone today. The Eurozone’s economic sentiment indicator, which declined to 95.2 in March, is expected to fall further to 94.5 in April.
Analysts expect the Eurozone’s consumer confidence indicator to decline for the second straight month to a reading of -16.7 in April, while the industry confidence indicator is projected to improve slightly to -10.1 in April, from -10.6 in the previous month.
Other Markets: Asian indices traded mixed this morning, with Japan’s Nikkei 225 and Hong Kong’s Hang Seng index up by 0.38% and 0.54%, respectively, and China’s Shanghai Composite down by 0.05%.
Russia’s President Vladimir Putin announced a surprise three-day ceasefire starting May 8 in honour of the 80th anniversary of the Second World War Victory Day. The news sent the RUB/USD pair lower in forex trading this morning.
Mexico’s trade surplus widened to $3.44 billion in March, from $1.99 billion in the year-ago period. The figure topping market estimates of $2.06 billion lent support to the MXN/USD forex pair.
Macau’s trade deficit shrank to MOP 9.4 billion in March, from MOP 10 billion in the same month last year, sending the MOP/USD pair lower in forex trading this morning.
Austria’s UniCredit Bank manufacturing PMI dipped to 46.6 in April, from 46.9 in the previous month. The country’s manufacturing activity falling to its lowest mark in three months exerted pressure on the EUR/USD forex pair.
US Dallas Fed’s manufacturing index dipped 19.5 points to a reading of -35.8 in April, which sent the Nasdaq 100 lower on Monday.
Eurozone’s loans to companies (1200 UAE Time), loans to households (1200 UAE Time), M3 money supply (1200 UAE Time), consumer inflation expectations (1300 UAE Time), selling price expectations (1300 UAE Time), services sentiment (1300 UAE Time), Italy’s business confidence (1200 UAE Time), consumer confidence (1200 UAE Time) and industrial sales (1300 UAE Time), Brazil’s IGP-M inflation (1500 UAE Time) and bank lending (1530 UAE Time), as well as US goods trade balance (1630 UAE Time), retail inventories (1630 UAE Time), wholesale inventories (1630 UAE Time), Redbook index (1655 UAE Time), S&P/Case-Shiller home price index (1700 UAE Time), FHFA house price index (1700 UAE Time), CB consumer confidence (1800 UAE Time), JOLTs job quits (1800 UAE Time), Dallas Fed services index (1830 UAE Time) and Dallas Fed services revenues index (1830 UAE Time).
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