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What Just Happened in Asian Gold Markets?


Jun. 20 2016, Updated 5:34 p.m. ET

The fall of gold, silver, and platinum

On Friday, June 17, gold closed marginally lower than on previous days, making it the second straight day of losses for the metal. Gold futures closed 0.28% lower at $1,294.8 per ounce, and the US dollar sank by about 0.62% on the same day. Silver and platinum also took part in the fall in precious metals, giving up 1.1% and 1.3%, respectively. Palladium, however, rose by 0.48%. The highest level that gold touched that day was $1,302.7.

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Funds and mining companies

Precious metal mining companies that rose on Friday despite these losses included New Gold (NGD), Sibanye Gold (SBGL), and Gold Fields (GFI). These three companies witnessed gains of 2.8%, 1.7%, and 1.4%, respectively, that day. These three companies combined make up about 8.3% of the VanEck Vectors Gold Miners Fund (GDX). GDX rose by 1.2% on the same day.

The two core gold and silver funds, the iShares Gold Trust (IAU) and the iShares Silver Trust (SLV), increased by 1.3% and 1.8%, respectively, on Friday as well. These two funds carefully follow the returns of the two most important precious metals.

Asian markets

Meanwhile, Asian demand for physical gold remained subdued during the week ending June 16, as gold rallied to its highest level in nearly two years. Gold’s gaining strength often fends off buyers, and now there are massive discounts being traded in India on physical markets.

However, Hong Kong exchanges are aiming to launch physically-delivered gold futures contracts in September, so that gold contracts will be simultaneously denominated and settled in US dollars and Chinese yuan.


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