Investing.com - Gold prices moved away from six-year highs but held above $1,500 on Thursday as risk appetite returned to financial markets, dampening demand for the safe-haven precious metal.
Gold futures for December delivery on the Comex division of the New York Mercantile Exchange, fell $14.65, or 0.9%, to $1,504.95 a troy ounce by 9:08 AM ET (13:08 GMT).
Risk-off sentiment appeared to be fading across financial markets with global stocks back on the upward path and appetite for traditional safe-haven assets such as gold, bonds or the Japanese yen diminishing.
Trade data from China sent a wave of relief through markets with exports unexpectedly surging in July and imports falling less than expected.
Despite analyst warnings that the data maybe temporary in the face of pending U.S. tariff increases on Chinese products in September, another round of yuan fixing by Beijing that was firmer than expected diminished market tensions.
In a light day for economic data with no scheduled Federal Reserve appearances, better-than-expected weekly jobless claims underpinned the strength of the U.S. labor market.
Concerns over the economic fallout from the ongoing U.S.-China trade dispute, coupled with increasing expectations that the Federal Reserve will need to lower interest rates further to benefit of non-yielding bullion, have sent gold on a bullish run bringing year-to-date gains of roughly 15%.
Analysts at brokerage Orbex suggested that gains looked overstretched.
“With the U.S. and China trade war narrative currently fading, focus could once again shift to the economic data,” they said.
While the gains in the precious metal are likely to see a modest pullback in the near term, the bias remains to the upside, these analysts said in a note.
John Reade, chief market strategist at the World Gold Council, highlighted still solid demand.
“Further decent inflows into gold ETFs yesterday, about 20 tonnes on a net basis, spit roughly 50:50 between U.S. and European listed products,” he tweeted.
In other metals trading, silver futures declined 1.8% to $16.890 a troy ounce by 9:10 AM ET (13:10 GMT).
Palladium futures advanced 0.4% to $1,415.85 an ounce, while sister metal platinum lost 1.6% to $857.25.
In base metals, copper traded up 1.1% to $2.600 a pound.