Gold prices fall on Hong Kong developments, U.S.-China trade talk resumption

Gold prices fell on Thursday in Asia as global stocks recovered on positive Hong Kong’s political development and reports that the U.S. and China would resume trade talks in October.

Gold Futures for December delivery were down 0.4% at $1,553.55 per ounce on the Comex division of the New York Mercantile Exchange by 12:25 AM ET (04:25 GMT).

The fall in the safe-haven metal came after the withdrawal of a controversial extradition bill in Hong Kong.

The bill sparked unexpected political unrest in the city since June, and the complete withdrawal of it was one of five demands that protesters have been fighting for.

However, despite the announcement, most believe that the unrest would continue.

Michael Yoshikami, founder and CEO of Destination Wealth Management, told CNBC in an interview that the “damage has been done.”

“While I think this certainly appears to be a positive step forward toward some sort of resolution, I think the impact is going to be felt in Hong Kong,” he said. “I think that is going to be something that we’re going to be dealing with for a significant period of time, months, for sure.”

Nevertheless, the news sent global stocks higher, with Hong Kong’s Hang Seng Index jumped as much as 4% on Wednesday. Gold prices on the other hand, suffered.

In Europe, British Prime Minister Boris Johnson was defeated in parliament on Wednesday as lawmakers prevented him from taking the country out of the European Union without a formal agreement on October 31.

Despite the losses today, gold prices are still up more than 20% this year, fed by fears over how bad the trade war will get, political uncertainty in the United Kingdom and Europe, and the potential for a world-wide recession.