'Dar Al-Sibaak': Gold recovers gains and closes at $4,071

Gold prices recovered some of their losses during last week’s trading sessions, closing at $4,071 per ounce following a decline in market risks and a return of buying activity to its previous momentum, which helped the precious metal rebound after a previous correction wave.

A report issued today by Kuwait’s Dar Al Sabaik stated that gold’s performance was supported by renewed buying at lower levels and improved investment demand for precious metals, alongside ongoing uncertainty regarding global economic developments, US monetary policy, and geopolitical risks.

The report clarified that last week’s trading saw notable fluctuations, with gold rising during Thursday’s session to levels exceeding $4,140 per ounce, before retreating on Friday amid a stronger US dollar and higher Treasury yields, ending the week at $4,071.

It added that despite the price decline in the final session, the recovery above the $4,000 level reflects an improvement in buying momentum compared to the previous week, with the market remaining sensitive to US economic data and interest rate expectations.

The report noted that markets entered the current week anticipating a series of key economic indicators, led by the US Consumer Price Index (CPI) for October, scheduled for release tomorrow, Tuesday, followed by the Producer Price Index (PPI) next Friday, alongside weekly jobless claims data and statements from Federal Reserve officials (the US central bank).

It highlighted that inflation data has gained particular importance following the release of a strong jobs report, as continued price increases could reinforce expectations of keeping interest rates at elevated levels for longer or increase the likelihood of a rate hike during next December’s meeting.

Dar Al Sabaik’s report pointed out that a clear slowdown in inflation could, conversely, ease pressure on the US dollar and bond yields, giving gold an opportunity to maintain its gains and complete its recovery, especially after returning to trade above the $4,000 level.

It stated that the US Dollar Index regained the 102-point level following the release of jobs data, coinciding with rising Treasury yields, which exerted pressure on gold prices during last Friday’s session.

The report indicated that the relationship between the dollar and yields will remain among the most significant factors influencing the precious metal’s movement, as their continued rise may limit upside opportunities, while their decline could stimulate investment demand for gold and silver.

It noted that geopolitical developments in the Middle East and risks to oil supplies and maritime navigation will remain important factors in energy markets due to their potential impact on global inflation expectations.

It said markets continue to monitor the performance of technology stocks and AI-related companies amid concerns over the valuations of major corporations and rising capital expenditure, which could lead to volatility in equity markets and shifts in risk appetite.

The report mentioned that silver also achieved gains last week, benefiting from the recovery in precious metals markets, while remaining affected by movements in the US dollar and bond yields.

It pointed out that industrial activity indicators in China and major economies will remain key factors to monitor in the coming period, especially given the link between silver demand and global economic growth expectations.

From a technical perspective, the report stated that the $4,050 per ounce zone stands out as the first support level, followed by the $4,000 level, which represents a significant psychological and technical barrier.

The report noted that if prices fall below the $4,000 level and stabilize underneath, selling pressure could intensify toward $3,940 and then the $3,875 zone, which saw low trading volumes during the previous correction wave.

Dar Al-Sibaak’s report clarified that a breakout above this zone and sustained trading above it could boost the chances of testing the $4,200 level, followed by $4,300, provided that supportive economic and financial factors for the metal continue to improve.

On the local front, the price of a gram of 24-karat gold reached approximately 0.40880 Kuwaiti dinars (about $1.32), while 22-karat gold was quoted at around 0.37475 dinars (about $1.21). Meanwhile, the price of a kilogram of silver stood at roughly 0.591 dinars (about $1.919), as local prices continued to be affected by fluctuations in global markets.