Metals Stocks: Gold edges higher ahead of trade talks

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Gold futures rose slightly Wednesday as traders kept an eye on U.S.-China tariff negotiations, developments around Brexit and economic data.

Gold for December delivery on Comex GCZ19, +0.47%  rose $5.90, or 0.4%, to $1,509.80 an ounce, while December silver SIZ19, +0.68%  gained 18 cents, or 1%, to $17.88 an ounce.

Analysts tied a rebound by stock-index futures and other assets perceived as risky to reports that China has expressed openness to a limited trade deal ahead of high-level talks set to get under wayin Washington on Thursday.

Sentiment around negotiations has swung back and forth between optimism and pessimism, with pressure on equities late Tuesday tied to a U.S. State Department decision to put visa restrictions on Chinese officials they tied to abuse of Muslim minorities in China. That followed a related decision by the Trump administration to blacklist several Chinese companies on a blacklist.

Uncertainty around the U.S.-China conflict, including fears the scope of the dispute is expanding beyond trade issues, has served to underpin gold, a traditional haven asset, analysts said.

“A wider scope in this protracted conflict would only heighten the barriers to a meaningful reconciliation between the world’s two economic powerhouses, while prolonging its drag on the global growth outlook,” said Han Tan market analyst at FXTM, in a note. “Risk aversion shall continue being the de facto mode for global investors, which should bode well for safe haven assets, keeping gold above $1,500.”

Uncertainty also remains over the U.K.’s plans to exit from the European Union amid increasingly strained relations between London and Brussels. The U.K. is scheduled to leave the EU on Oct. 31, while prospects for a deal that would govern the country’s relationship with the block appeared to fade on Tuesday as London and Brussels traded insults over a stalemate in talks.

In other metals trade, January platinum PLF20, -0.04%  rose 0.7% to $895.90 an ounce, while December palladium PAZ19, +0.79%  gained 0.7% to $1,663 an ounce.

December copper HGZ19, +0.02%  was up 0.2% at $2.5725 a pound.