By Barani Krishnan
Investing.com - Wall Street’s soon-to-reopen mantra about U.S. businesses coming back from the Covid-19 pandemic hit Friday’s gold trading, sparking pre-weekend profit-taking that yanked the yellow metal below its recently-acquired $1,700 berth.
Gold futures for June delivery on New York’s COMEX settled down $32.90, or almost 2%, at $1,698.80 per ounce.
For the week, June gold was down more than $62, or 3.5%.
Just on Tuesday, COMEX’s front-month contract hit a seven-year high of $1,788.75, after a gain of $165, or 10%, since end-March.
Spot gold, which tracks live trades in bullion, was down $34.88, or 2%, at $1,682.88 by 3:45 PM ET (19:456 GMT).
Wall Street’s Dow rose 3%, boosted by optimism over a potential coronavirus treatment and hopes the U.S. economy could reopen fairly soon.
The White House unveiled late on Thursday guidelines that governors of the 50 U.S. states could use in reopening businesses locked down for four weeks now in an attempt to control the Covid-19 outbreak.
Analysts were, however, optimistic that gold will reclaim its $1,700 berth.
“Risk appetite is soaring, but it might be overdone as permanent damage to the economy will see a battered U.S. consumer,” said Ed Moya, analyst at online trading platform OANDA.
“Gold will remain supported by the boatload of monetary and fiscal stimulus that will be in place for the foreseeable future. Record high calls for gold in dollar-denominated terms are slowly becoming the base case scenario, so we could see volatility ramp up over the coming weeks.”