Gold gains as Hong Kong tensions fuel trade deal doubts

• Palladium retreated slightly after hitting an all-time peak of $1,836.61 earlier in the session.
• Spot gold was up 0.1pc at $1,455.63 per ounce by 0659 GMT. U.S. gold futures rose 0.1pc to $1,454.80.
• Gold eased 0.5pc in the last session on a raft of upbeat economic data from the United States.

Gold prices rose on Thursday as investors bought the safe-haven metal on doubts about whether the United States and China will seal a trade deal after President Donald Trump signed a legislation supporting Hong Kong protesters.

Palladium retreated slightly after hitting an all-time peak of $1,836.61 earlier in the session.

Spot gold was up 0.1pc at $1,455.63 per ounce by 0659 GMT. U.S. gold futures rose 0.1pc to $1,454.80.

Trump on Wednesday signed a legislation into law that requires the State Department to certify, at least annually, that Hong Kong retains enough autonomy to justify favourable U.S. trading terms.

Beijing condemned the move and said it would take "firm counter measures."

"With the latest developments of Trump signing the Hong Kong bill, there are doubts that there will be any deal, even a first phase," said Jigar Trivedi, a commodities analyst at Mumbai-based Anand Rathi Shares & Stock Brokers.

"Even though they've said they will sign a deal by year-end, they've not talked about the venue, or who will go to whom. So, I don't think the trade deal will be signed so easily and gold will be supported."

Asian shares fell, while the safe-haven yen rose against the dollar on concerns that the protracted tariff dispute between the world's two biggest economies could become more complicated.

Gold eased 0.5pc in the last session on a raft of upbeat economic data from the United States.

Economic growth picked up slightly in the third quarter, weekly jobless claims fell, while new orders for key U.S.-made capital goods increased.

"Global growth concerns have definitely eased, but not gone," said John Sharma, an economist at National Australia Bank, adding gold would remain supported even if an interim deal is passed since the most complex issues, such as intellectual property, have been pushed down the road.

Gold, considered a safe store of value during economic or political uncertainties, has gained more than 13pc this year, mainly due to the tariff dispute.

Among other precious metals, palladium shed 0.1pc to $1,831.69 per ounce.

The autocatalyst metal used in vehicle exhaust systems to reduce harmful emissions has risen about 45pc this year on a supply crunch.

"Strong demand from China and sluggish supply growth have tightened palladium's physical market this year...," ANZ said in a note.

Platinum was flat at $892.95 per ounce and silver rose 0.1pc to $16.96 per ounce.