Gold breaks above $1,500 on growth fears, stock market highs

Bengaluru - US-China trade dispute drives 16% rise in prices, putting yellow metal on track for best year since 2010

Gold rose above $1,500 an ounce as lingering fears of recession and equity market highs drove investor demand.
Spot gold was up nearly 1 per cent in thin trade at $1,499.48 per ounce by 1840GMT, its highest since November 5, while US gold futures settled up 1.1 per cent at $1,504.80.
"We are still not seeing good [US] numbers come out of the business investment side. We are wholly dependent on consumer spending. But when consumer spending starts to flag a bit, then the economy could really start to slow down more noticeably," Edward Meir, analyst at ED&F Man Capital Markets, said. 
New orders for key US-made capital goods barely rose in November and shipments fell, data showed, suggesting business investment will probably remain a drag on economic growth in the fourth quarter. 
Data from the United States is keenly watched for cues on the central bank's future monetary trajectory. Gold is sensitive to rising interest rates, which lifts its opportunity cost.
Meanwhile, optimism on US-China trade talks has lifted equities to record levels. World stocks remained on track for their best year in a decade, while Wall Street dipped from near-record levels. 
"The stock market is getting very overbought. If you have a correction in stocks, gold could benefit," Meir added.
US President Donald Trump said on Tuesday he and Chinese President Xi Jinping will have a ceremony to sign the first phase of a trade deal agreed this month.
The 17-month long dispute has driven a 16 per cent rise in gold prices, putting it on track for its best year since 2010.
Elsewhere, palladium rose 0.5 per cent to $1,884.16 an ounce.
Platinum inched 0.4 per cent higher to $940.08, while silver rose nearly 2 per cent to $17.76 an ounce, setting it for a fifth straight session of gains.

• Gold and Forex