MW: Gold futures slip after Obama’s speech on Syria
By Polya Lesova and Shawn Langlois, MarketWatch
NEW YORK (MarketWatch) — Gold futures edged back on Wednesday after President Barack Obama said he’s open to a diplomatic solution on the Syria crisis but reserved the option of a military strike.
In his televised speech Tuesday night, President Obama said he had asked Congress to postpone a vote on whether to strike Syria while he pursued a Russian proposal for a diplomatic solution to the standoff. Obama, however, also said that the U.S. must strike Syria if needed in response to the use of chemical weapons by Syria’s regime.
The latest proposal by Russia is for Syria to surrender its chemical weapons under international control; Obama said it’s too early to tell whether the offer will succeed and whether Syria’s president will keep his commitments.
Gold for December delivery GCZ3 -0.13% fell $2.30, or 0.2%, to $1,361.80 an ounce on the Comex division of the New York Mercantile Exchange.
Gold prices fell more than $20 an ounce on Tuesday, suffering their biggest hit since July 5 following indications that the Syria crisis may be resolved through diplomacy.
“This recent move certainly feels like a Syria-off trade,” said BTIG chief global strategist Dan Greenhaus. “Gold and oil have both stopped rallying, the dollar has pulled back, and Treasurys, which rallied somewhat, have again pulled back, pushing yields back higher.”
Analysts at Commerzbank AG said that the abating geopolitical tensions in the Middle East have caused the recent drop in gold prices.
“Syria agreed yesterday to Russia’s proposal that it place its arsenal of chemical weapons under international control, whereupon a military strike against the Assad regime would initially appear to have been averted,” they wrote in a note on Wednesday. “This reduces the demand for gold as a safe haven. Additionally encouraged by climbing equity markets, ETF investors have once again been selling their gold holdings.”
Elsewhere in metal trade, December silver SIZ3 +0.60% added 12 cents, or 0.5%, to $23.14 an ounce, while December copper HGZ3 +0.51% rose 2 cents, or 0.5%, to $3.28 a pound.
October platinum PLV3 +0.41% advanced $8.80, or 0.6%, to $1,482.90 an ounce.
December palladium PAZ3 +1.13% added $9.10 to $701.75 an ounce.
Polya Lesova is MarketWatch's New York deputy bureau chief. Follow her on Twitter @PolyaLesova.
Shawn Langlois is an editor and columnist for MarketWatch in London. Follow him on Twitter @slangwise.
