Gold futures fell to the lowest in almost two weeks and bullion mining stocks sank as investors favored riskier assets on expectations that Emmanuel Macron will become France’s next president. Copper and other industrial metals rose.
The metal slipped as much as 1.8 percent in New York and a Bloomberg Intelligence gauge gold miners plunged as much as 2.7 percent after pro-growth centrist Macron and nationalist Marine Le Pen won the first-round vote on Sunday.
Le Pen, who wants to take France out of the euro and cut immigration, has trailed Macron in almost every opinion poll for the runoff. A second round takes place on May 7. With the second-round line-up avoiding the scenario of a contest between Le Pen and communist-backed Jean-Luc Melenchon, widespread relief across markets pushed European stocks and the euro higher, and cut gold’s gain this year to 11 percent.
Hedge funds had recently boosted bullish gold bets and investors bought bullion through exchange-traded funds amid demand for a haven amid concerns over North Korea.
“Gold has benefited from geopolitical tensions this year and the market was pricing in a nasty surprise in France,” said Bernard Dahdah, an analyst at Natixis SA in London. “That has subsided with the fact that there won’t be two extreme candidates in the second round.”
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