Gold prices climbed overnight as renewed anxiety across global markets lifted demand for safe-haven assets ahead of key US labour data.
Spot gold was trading at $3,980 an ounce by 08:45 GMT, rebounding from Tuesday’s low of $3,929.
Equity markets turned lower after the CEOs of Goldman Sachs and Morgan Stanley both warned that valuations look stretched and that a sharp correction may be due. Their remarks triggered a sell-off on Wall Street and weighed on Asian markets early Wednesday.
Sentiment was further unsettled by reports that investor Michael Burry has taken a large short position against Palantir, arguing the company’s valuation is unsustainable.
The renewed risk aversion has supported gold, though gains remain capped by a stronger US dollar and fading expectations for another Federal Reserve rate cut this year. Fed Chair Jerome Powell recently signalled that further easing is “not a foregone conclusion,” tempering market optimism.
Traders are now watching the US ADP employment report due later today for fresh clues on the labour market and the Fed’s next move. With official data delayed by the government shutdown, the ADP figures are expected to carry extra weight.