MTECHTIPS:-Gold pares gains despite risk events ahead

MTECHTIPS:-Gold pares gains despite risk events ahead

MTECHTIPS-Gold pulled back from six-week highs on Monday, as safe-haven demand eased despite renewed geopolitical tensions and a flurry of risk events later during the week that could spark turmoil in markets. Gold futures for August delivery on the Comex division of the New York Mercantile Exchange rose $3.05 or 0.24%, to $1,283.18 a troy ounce. Gold hit a six-week high in earlier trade, on the back of fresh geopolitical tensions in the Middle East, after Saudi Arabia, the United Arab Emirates, Bahrain and Egypt severed ties with Qatar on Monday, accusing it of supporting terrorism. Gains in gold, however, were short-lived, as the yellow-metal failed to capitalize on the release of mostly downbeat U.S. economic data, which added to concerns of a slowdown in the U.S economy. U.S. non-manufacturing activity grew at a slower pace in May, as the Institute for Supply Management on Monday said its non-manufacturing index fell 0.6 points to 56.9 in May. In a separate report, the Commerce Department said Monday that Factory orders dipped 0.2% in April, in line with forecasts. Gold is expected to remain supported during the week, as market participants will contend with a raft of risk events that could rattle markets. On Thursday, the UK heads to the polls in the general election, whose outcome has become much less certain of late, after the latest opinion poll predicted that the Conservatives may fall short of the required number of seats for a majority. A You Gov poll on Sunday, suggested that the Conservatives will win only 305 seats in the House of Commons, above Labor’s 268 but well short of the 326 seats needed for a majority.
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