Hong Kong Stocks Edge Up, Gold Surge Continues

Hong Kong stocks were slightly higher by the break on Tuesday following a recent string of losses, with investors looking to a Federal Reserve policy meeting later in the week that could see it unveil further easing measures.

The Hang Seng Index added 0.5 percent, to 24,733.

On the mainland, the Shanghai Composite Index added 0.2 percent to 3,211, while the Shenzhen Composite Index gained 0.90 percent to 2,162.

Tokyo added 0.3 percent and Sydney gained 0.6 percent. Seoul and Taipei each climbed more than 1 percent and there were also gains in Singapore, Jakarta and Wellington.

Gold chalked up another record as the US dollar extended losses and traders rushed into safe havens as fears about the coronavirus pandemic mounted.

The virus uncertainty descending on trading floors, combined with China-US tensions, has sent gold soaring nearly 30 percent and on Tuesday it hit another record of US$1,981.27, smashing the previous day's all-time high.

And observers say US$2,000 could be broken as early as this week, with focus on the Federal Reserve's next policy meeting, which is tipped to see it unveil more easing measures to support the world's top economy. The rush for bullion has also dragged silver to a seven-year high above US$26 an ounce.

US second-quarter economic growth data is also due this week, and a disappointing reading on what is expected to be a historic contraction could fuel further dollar weakness.

"There seems to be enough momentum in the US money supply to actually push gold higher," Fat Prophets analyst David Lennox said.

"As Covid-19 continues to ravage the economy, there's probably more stimulatory action to come. As the US dollar weakens, obviously gold will improve, but it's more a matter of the acceleration of US money supply, and that's caused by governments obviously throwing money into the economy." (AFP)

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