With uncertainties on the rise for tonight’s press conference, gold could be a good bet.
- US President Donald Trump said he will be giving a press conference tonight on China amid spiralling US-China tensions over Hong Kong and the coronavirus fallout.
- US stock futures ended its 3-day winning streak and closed lower. Dow Jones Industrial Average DJIA, -0.57% fell 147.63 points, or 0.6%, at 25,400.64, well off its best level at 25,758.79, while the S&P 500 index SPX, -0.21% ended off 0.2% at 3,029.73 and the Nasdaq Composite Index COMP, -0.46% declined 0.5% at 9,368.99.
- China’s move to crack down on Hong Kong by passing national law has led to Trump taking a hard line against China. Reports have said that Trump is planning to impose relatively mild new sanctions on visas and China’s access to the global financial system.
- Washington and Beijing are already clashing over responsibility for the extent of the coronavirus pandemic. When asked on Thursday if Trump would commit to the terms in the phase one trade deal signed on January, he said, “We are not happy with China. We’re not happy with what’s happening.”
- We believe that the press conference tonight will not yield any optimism from the market and could give US stock futures a reason for a perfect sell-down.
- With risk aversion expected to rise, it would be safer to stick to gold for now. Gold prices could rise higher towards 1750.
Fullerton Markets Research Team
Your Committed Trading Partner