Gold recovers as US stimulus concerns dent risk sentiment

Gold clawed back some lost ground on Wednesday, after sinking 6% in the previous session, as equities stalled on doubts over an additional round of U.S. fiscal stimulus and rising Sino-US tensions.

FUNDAMENTALS
Spot gold was up 0.5% at $1,920.04 per ounce by 0045 GMT, having suffered its largest one-day drop in more than seven years on Tuesday due to a bounce in risk appetite and firmer dollar.


U.S. gold futures fell 0.7% to $1,930.70.

A stalemate between the Republican White House and congressional Democrats over coronavirus relief ended in a fourth day without talks on Tuesday, with each party blaming the other for intransigence.

President Donald Trump's executive order banning China's TikTok could prevent U.S. app stores from offering the popular short-video app and make advertising on the platform illegal, according to a White House document seen by Reuters.

Meanwhile, Trump said his relationship with Chinese President Xi Jinping has frayed in the wake of the COVID-19 pandemic.

More than 20.19 million people have been reported to be infected by the new coronavirus globally and 736,577? have died, according to a Reuters tally.

Asian stocks were set for choppy trade after Wall Street dipped amid growing uncertainty about an additional round of U.S. fiscal stimulus.

The dollar index held steady against a basket of major currencies.

SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 0.3% to 1,257.93 tonnes on Tuesday.

Silver rose 1.6% to $25.18 per ounce, platinum gained 0.5% to $934.52 and palladium was steady at $2,091.59.