Election Day Shines for Gold Futures Prices

November 8, 2016 4:06AM CST

Commodities futures markets are mixed ahead of the results of the U.S. presidential election Tuesday, with prices shining in the metals sector. Prices of safe-haven assets such as gold futures are fluctuating as participants hesitate to make moves. As commodities futures markets and equities analysts have stated for weeks, if Donald Trump wins the elections, the uncertainty in the short term would lead to flight-to-quality sectors.

At present, the December contract in gold futures was up .42 percent at $1,284.90 an ounce and climbing higher. Gold futures sank to a one-week low of 2 percent at 1279.4 yesterday after the FBI said that no charges were warranted in the case of Hillary Clinton's use of a private email server.

In terms of rate hike relevance, if Clinton is declared the winner tonight, gold futures will sell off, as the market will interpret this has having more certainty and thus more likely that the Federal Reserve will raise interest rates in December. Commodities futures analysts say that with Clinton ahead in the polls, some of this should be priced in. However, if Trump does lead in the polls, prices in gold futures will stabilize, according to analysts. There are mixed thoughts on market outcomes if the election is challenged or prolonged, which could lead to the delight of many media conglomerates.

Prices in the other contracts within the metals sector of commodities futures are rising in mid-morning trading. The December contract in silver futures rose 2.12 percent to 18.42, while copper futures prices for the same month jumped 2.68 percent to 2.371. Data in China showed that exports and imports fell more than expected in October, weighing on copper futures prices. October exports fell 7.3 percent from a year earlier, while imports shrank 1.4 percent.

The economic calendar in the U.S. contains one report of minor significance to the commodities futures markets, particular in the face of the election. There were 5.486 million job openings in the US in September, according to the Job Openings and Labor Turnover Survey (JOLTS) compared to expectations of 5.488 million.

Other reports of note to commodities futures markets include September Wholesale Inventories on Wednesday, the October Treasury Budget on Thursday, and the November University of Michigan Consumer Sentiment report on Friday.

Friday is expected to be a light-volume trading day in the commodities futures markets due to the Veterans Day holiday in the U.S. Treasury futures markets are closed.

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