Gold heads for strong weekly gain as stock market exit persists

MarketWatch/Rachel Koning Beals/08-11-17

Precious metals headed for strong weekly gains Friday, extending prices that were already at their highest level in more than two months as simmering North Korean tensions slammed stocks and other assets perceived as risky.

Gold gained as U.S. stocks were headed toward their worst weekly performance since November.

“Risk-off mode is in full swing with investors piling their bets in Japanese yen, the Swiss Franc and the yellow metal. Profit-taking is the major theme when it comes to the equity market,” said Naeem Aslam, analyst at Think Markets.

…Geopolitical tension persisted after a North Korean army commander this week said “sound dialogue is not possible” with U.S. President Donald Trump and “only absolute force can work on him,” according to state media. North Korea also laid out detailed plans of how it would launch a missile strike on U.S. military bases in Guam. Late Thursday, Trump said his threat to unleash “fire and fury” on North Korea “maybe wasn’t tough enough.”

Ray Dalio, chairman and chief investment officer at Bridgewater Associates, on Thursday urged investors to hedge their risks with gold amid rising geopolitical tensions.

PG View: As mentioned in yesterday’s DMR: Remember when the dollar used to be THE safe-haven currency?

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